Japex unit seeks to expand Canadian oil sands operations

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, May 18 -- Japan Petroleum Exploration Co. subsidiary Japan Canada Oil Sands Ltd. (Jacos) submitted a joint application to the Alberta Energy Resources Conservation Board and Alberta Environment for approval to expand its oil sands production operations.

Jacos’ application requests an expansion of its operations in the Hangingstone area leases of up to a maximum incremental production of 35,000 b/d of bitumen. Based on the planned development scenarios, Jacos said ongoing production from the expansion facilities could average 25,000-30,000 b/d.

Jacos also is commencing the preliminary engineering phase, during which the plant capacity and configuration will be optimized. Jacos said it has allowed 18 months for the regulatory approval and front-end engineering and design processes.

“In late 2011, the company anticipates project sanction, subject to obtaining regulatory approval, as well as the completion of the preliminary engineering along with updated project costs and economics,” Jacos said.

Upon approval, construction of the central production facility is expected to begin in the winter of 2011-12 with initial site clearing and rough grading, Jacos said. Production startup is anticipated by the end of 2014.

In 2008, Japex said it planned to invest ¥240 billion over the next 5 years, of which ¥160 billion would be used to develop and explore projects outside of Japan, including in Libya, Indonesia, and Canada (OGJ Online, May 29, 2008).

Jacos is operator of the oil sands venture with a 75% working interest. Nexen Inc. holds the remaining 25%.

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