CALGARY — A cap on greenhouse gas emissions in the oilsands is an unnecessary part of Alberta’s climate leadership plan, Imperial Oil Ltd.’s CEO said Friday.
The province could have used existing regulatory practices and procedures to drive environmental improvements, Rich Kruger told reporters after the annual meeting of shareholders.
CALGARY — The first phase of Imperial Oil Ltd.’s Kearl oil sands mine will cost $2-billion more than previously expected as the company faced issues transporting Korean-made modules to the mine site in northern Alberta and contended with harsh weather during startup.
The first 110,000-barrel-per-day phase will now cost $12.9-billion, up from a previous estimate of $10.9-billion.
Taking into account a second $8.9-billion phase in the works, the whole development is expected to have a cost of $6.80 per barrel, up 10% from a prior estimate of $6.20.
The modest rebound in oil prices is fuelling hope that the worst of the downturn is over, but Canadian industry stalwarts such as Imperial Oil Ltd. and Suncor Energy Inc. aren’t taking any chances.
“We are still early in this cycle and the dust has not settled,” Rich Kruger, chairman and CEO of Canada’s oldest oil company, told shareholders at the company’s annual meeting in Calgary Thursday.
Calgary-based Imperial managed to do better than most in the first quarter, when oil prices tanked to the mid-US$40s a barrel.
Imperial Oil Ltd said on Monday its expects its $12.9-billion Kearl oil sands project to begin operating within the next two weeks, more than three months past its original target, but the company cannot yet say how much oil the plant will initially produce.
Pius Rolheiser, a spokesman for Imperial, said operations at the first of Kearl’s three production trains, capable of handling up to 50,000 barrels of heavy oil sands crude per day, will begin by month’s end.
Kurt Wulff (McDep Associates) submits: We recommend current purchase of the common stock of Imperial Oil (IMO) for unlevered appreciation potential of 51% to a McDep Ratio of 1.0 where price would equal Net Present Valu
CALGARY • Imperial Oil Ltd. will have to scale back plans to double production by the end of the decade if planned oil pipelines are delayed, its new CEO said Thursday.
But Richard Kruger, the Minnesotan who took the controls of Canada’s oldest oil company on March 1, said he’s confident that Keystone XL from Alberta to the U.S. Gulf and other proposed pipelines to Canada’s West and East will go ahead.
Imperial Oil Ltd has upped its cost estimate for the Mackenzie Gas Project in Canada’s far north by about 40% because of rising prices for materials and labor, meaning the entire project would cost more than $20 billion if it goes ahead.
Imperial, 69.6% owned by Exxon Mobil Corp, said it has still not decided whether to proceed with the long-delayed project given the weak state of the North American natural gas market.
Imperial Oil Ltd. has applied for regulatory approval to build a new oil sands project northeast of Fort McMurray, Alta., which would cost an estimated US$7-billion.
Company spokesman Pius Rolheiser emphasized the price tag is “very preliminary” and there’s a good chance it could change as engineering work proceeds.
“As project definition advances and as market conditions evolve, obviously it has the potential to impact the cost estimate,” he said.