ALBERTA APPROVES GAS DEVELOPMENT PROJECT

Shell Canada Ltd. has received regulatory approval for an $825 million sour gas development project in the Caroline area of Alberta, 75 miles northwest of Calgary. The provincial Energy Resources Conservation Board chose a Shell proposal for the 2 tcf field over a competing plan submitted by Husky Oil Ltd. Shell holds a 61.2% interest in the field, which it discovered in 1986. Its main partners are Husky 11.6%, Gulf Canada Resources Ltd. 8.5%, and Union Pacific Resources Ltd. 6.7%. The

Sept. 10, 1990

2 min read

Shell Canada Ltd. has received regulatory approval for an $825 million sour gas development project in the Caroline area of Alberta, 75 miles northwest of Calgary.

The provincial Energy Resources Conservation Board chose a Shell proposal for the 2 tcf field over a competing plan submitted by Husky Oil Ltd.

Shell holds a 61.2% interest in the field, which it discovered in 1986. Its main partners are Husky 11.6%, Gulf Canada Resources Ltd. 8.5%, and Union Pacific Resources Ltd. 6.7%. The remaining 12% is shared by 10 other companies.

The project will include development drilling, an underground molten sulfur pipeline, gathering facilities, and a gas processing plant. Shell plans to break ground in October for construction of the processing plant.

The field is expected to produce 100 MMcfd of gas, 17,500 b/d of condensate, 28,000 b/d of natural gas liquids, and 4,000 metric tons/day of sulfur at full development early in 1993.

COMPETING PROPOSAL

The Husky proposal involved upgrading its 630 MMcfd gas processing plant at Ram River, Alta., and laying a 35 mile pipeline from the field to the plant.

The ERCB report said the Shell proposal was the best in terms of the overall public interest. It was supported by more people in the area and provided greater economic benefits.

The report agreed that some aspects of the Husky plan were better for the environment, but the Shell plan was advanced, safe, and technically reliable. It said the Shell project will incorporate future developments in a way that could reduce pollution in the long term.

Husky expressed disappointment at ERCB's decision but said it is prepared to "help expedite speedy development of this huge gas resource." The Shell plan drew opposition from environmental groups and owners of recreational properties in the area.