Engineering set for Husky upgrader expansion

March 21, 2006
Husky Energy Inc., Calgary, has approved plans to immediately begin the $90 million detailed engineering to increase capacity of its Lloydminster heavy oil upgrader to 150,000 b/d (OGJ Online, Dec. 2, 2005).

By OGJ editors
HOUSTON, Mar. 21 -- Husky Energy Inc., Calgary, has approved plans to immediately begin the $90 million detailed engineering to increase capacity of its Lloydminster heavy oil upgrader to 150,000 b/d (OGJ Online, Dec. 2, 2005).

A debottlenecking program under way will boost the current capacity of 77,000 b/d to 82,000 b/d by yearend. The upgrader converts heavy oil into low-sulfur synthetic crude for Canadian and US refineries. Husky also processes 25,000 b/d from asphalt operations.

Engineering is scheduled for completion in 15-18 months. Oversight will include executing licensing agreements, preparing bid packages, seeking environmental assessment approvals, and developing cost estimates.

The $2.3 billion (total) expansion will enable Husky to process additional heavy oil forecast at Lloydminster and at the Tucker oil sands project at Cold Lake, 250 km to the northwest. Lloydminster production is expected to average 115,000-120,000 b/d this year.

Husky will begin steam injection at the Tucker oil sands facility this summer, with first oil production expected by yearend. Peak production of more than 30,000 b/d is expected by mid to late 2008.