Imperial's Aspen project moves one step closer to approval
The solvent-assisted steam-assisted gravity drainage (SA-SAGD) project, located just east of the Syncrude lease, has a peak bitumen production rate of 162,000 bbl/day. The technology promises to be 25% less capital intensive than most existing SAGD operations, with 25% less GHG emissions per barrel.
Over 4 years in the works
Imperial kicked-off its environmental review process for Aspen in 2012, submitting its regulatory application to the AER at the end of 2013. The project has yet to be approved by the provincial regulator.
CEO Rich Kruger has expressed dismay over how long Aspen has been held up in the regulatory review process. Imperial had counted on Aspen to lead its next major growth phase in the oil sands.
The CEO calls the delays "inordinately long," given the project's "strong economics" and "pace-setting environmental performance." Aside from regulatory red-tape, Kruger says capital investment at his company is at historic lows due to pipeline congestion and rising costs.
According to the World Bank, Canada ranks 34 out of 35 OECD countries in the time required to obtain permit for new projects. That timeline is likely to get extended after the federal Liberals enact Bill C-69, handing over project approvals to the new Impact Assessment Agency of Canada, which will see more consultations with stakeholders.
One more hurdle cleared
The province's Aboriginal Consultation Office submitted its reports last January, after which the AER scheduled public hearings for the project. The Fort McKay First Nation were the only group to file a request to participate in the sessions, but now say they will address its concerns directly with Imperial. The hamlet of Fort McKay is located just 20 km west of the Aspen lease. The AER has since concluded that public hearings are therefore no longer required.
Aspen's first phase of development has an estimated capital cost of $2.4 billion. Imperial has repeatedly warned a blessing from the AER does not guarantee a positive final investment decision, particularly in light of the recent cancellation of the Trans Mountain Expansion pipeline.
Despite no relief in sight for Alberta's producers, hope springs eternal for another major project in the oil sands.