Nexen green lights SAGD expansion at Long Lake
Nexen Energy announced a positive final investment decision (FID) on its Long Lake Southwest expansion project, located near the hamlet of Anzac, just south of Fort McMurray.
The $400 million expansion will add 26,000 bbl/day of bitumen production from three new well pads that will be tied-in to Nexen’s existing Long Lake in-situ oil sands facility. Long Lake uses steam-assisted gravity drainage (SAGD) to extract bitumen from the McMurray Formation reservoir.
The company says the project will lower Long Lake's overall steam-to-oil ratio (SOR), significantly improving the facility's GHG performance. Construction is set to begin shortly, with first oil anticipated in late 2020.
Production out of the original 70,000 bbl/day Long Lake SAGD facility, which began operating in 2008, fell short of its design capacity. The facility was originally integrated with the adjacent Long Lake Upgrader, which was taken offline in 2016 after a fire damaged the facility.
The initial phase of Nexen's Long Lake South expansion (later renamed Kinosis 1A), came online in 2014 and was designed to add anther 20,000 bbl/day of capacity. The facility now produces diluted bitumen (Long Lake Heavy) but the company has left the door open to potentially repairing and restarting the upgrader sometime in the future.
This latest phase of expansion already has all regulatory approvals in place from the Alberta Energy Regulator (AER).
Nexen Energy is a wholly-owned subsidiary of state-owned China National Offshore Oil Company (CNOOC) Limited.
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