Imperial delays Aspen start-up to late-2023
Imperial Oil CEO Rich Kruger fired another shot at Alberta's NDP government on Friday morning, announcing plans to delay the Aspen oil sands project.
Aspen is a solvent-assisted, steam-assisted gravity drainage (SA-SAGD) facility, located about 15 km west of Fort McKay. The $2.6 billion project was sanctioned last November, for the first phase of 75,000 bbl/day. Construction was expected to begin later this year, with first oil expected in 2022.
Due to the nature of the winter drilling season, Imperial says start-up will likely be delayed about 1-year.
The company blames the delay on "government intervention and other industry competitiveness challenges." Imperial reiterated its view that the province's curtailment program has sent "a negative message to investors," creating the unintended consequence of making crude-by-rail uneconomical.
Imperial had planned to ship 168,000 bbl/day by rail in December, but has since suspended all rail activity. Rail exports to the US hit a record high of over 350,000 bbl/day at the end of last year, but those numbers have been reduced considerably since then.
Kruger says his decision to delay Aspen was a "difficult choice" but the company "cannot invest billions of dollars ... given the uncertainty in the current business environment."
The move comes just months before a provincial election, that will likely see a change in government leadership.