Jacos okays Hangingstone SAGD project

Japan Petroleum Exploration Co. Ltd. (Japex) has approved commercial in situ development of its Hangingstone oil sands project south of Fort McMurray, Alta., by its consolidated subsidiary Japan Canada Oil Sands Ltd. (Jacos).

Jacos currently operates an adjacent demonstration project producing 6,000-7,000 b/d of bitumen via steam-assisted gravity drainage. The demonstration project has been in operation more than 10 years.

The commercial project will use SAGD to boost production capacity to 20,000 b/d, which might be expanded to 30,000 b/d after start-up. Alberta authorities approved the project in November.

Jacos holds a 75% interest in the project. Nexen Inc. holds the rest.

The project is separate from another SAGD development, also in the southern Athabasca region, by the same name approved recently by Athabasca Oil Corp. (OGJ Online, Nov. 28, 2012).