Suncor Inc., Toronto, is moving to trim costs at its Fort McMurray, Alta., oilsands plant.
It also is investing in new equipment and oilsands leases.
Meanwhile, partners in the $4.8 billion OSLO plan for a new oilsands operation in the Fort McMurray region say the project is on the shelf indefinitely. Partners are winding down participation,
SUNCOR OPERATIONS
Suncor will spend $100 million (Canadian) for a big shovel and a fleet of trucks to replace an aging bucket-wheel and conveyer belt system at its bitumen surface mining operation (OGJ, Nov. 9, p. 33). The new mining system is to be in operation by 1994.
Staff cuts in 1992 and 1993, amounting to a 17% reduction in work force, will be related to new technology.
The company hopes to cut production costs $5-7 (Canadian)/bbl from the present $19/bbl and boost production to 68,000 b/d from 60,000 b/d.
Suncor bought two more leases in the Fort McMurray area, extending its oilsands reserves to an estimated 50 year supply. The company negotiated a royalty assistance program with the Alberta government for lease development.
Suncor also plans to build a $270 million utilities plant for its oilsands operation, which will substantially reduce sulfur dioxide emissions.
Suncor will take a $238 million after tax writedown attributed to cost of the restructuring program and other operations. This includes a $95 million writeoff on an experimental steam project for heavy oil recovery at Burnt Lake, Alta.
Syncrude Canada Ltd., the only other oilsands operator in the Fort McMurray area, said it has no plans for changes in current staff level of about 4,400. Syncrude also is investing in new shovel and truck equipment but will maintain an existing dragline system.
The Syncrude and Suncor mining operations marked a milestone this year by hitting combined cumulative production of 1 billion bbl. Of that total, Syncrude reached 600 million bbl in September.
Syncrude reports reduced production costs. It is aiming for a 1992 average of $15 (Canadian)/bbl. Average in a 12 month period to June 30, 1991, was $14.96/bbl.
OSLO PROJECT
Gordon Willmon, chairman of the six company OSLO group, said the project is virtually dead in its present form.
It included development of oilsands leases in the Fort McMurray area and an upgrader at Redwater, Alta.
Willmon said OSLO, which stands for Other Six Leases Operation, will be developed eventually, but the timing is uncertain.
Willmon, an executive with Imperial Oil Ltd., one of the partners, said his company is investigating cheaper extraction methods for oilsands.
Alberta leases on OSLO's oilsands properties are in effect until 2001.
Partners include the Alberta government, Canadian Occidental Petroleum Ltd., Gulf Canada Resources Ltd., Imperial, Petro-Canada, and PanCanadian Petroleum Ltd.
Copyright 1992 Oil & Gas Journal. All Rights Reserved.
