Shell Canada Ltd., Calgary, says it will spend $50 million (Can.) to restart a heavy oil project in the Peace River area of northern Alberta using new technology. The recovery process, known as soak radial, uses steam to soak bitumen and improve flow of the crude oil trapped in sand.
The company will seek to increase production to about 8,000 b/d. Shell will drill 18 wells with several arms extending horizontally from a single bore, and steam will be injected into the reservoir for 2 months to loosen bitumen for production from the same well.
Shell started a pilot project at the site in 1986 but shelved plans for a large commercial development two years ago when crude oil prices fell. The company says if results are good it will consider expanding the drilling program in 2001 to increase production to 12,000 b/d.
There are now about seven steam-assisted recovery projects in Alberta, planned or under construction, with a capital value of about $4.8 billion.