Suncor plans expansion to Edmonton area (3:28 p.m.)
Would bring upgraders in Strathcona, Sturgeon counties to eight
Gordon Jaremko, edmontonjournal.com
Published: Thursday, December 14, 2006
After 39 years as a Fort McMurray mainstay, Alberta’s pioneer oilsands producer has taken a first step towards expanding into the Edmonton area.
Suncor Energy Inc. has scooped up options on about 14 square kilometres of Sturgeon County land northeast of the capital. Regional consultations on industrial development will start in early 2007, company spokesman Brad Bellows said today.
The property is “suitable for construction of an upgrader,” Bellows said in an interview. “We haven't made any firm decisions,” he added.
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Font: ****No details of the project or its exact location were disclosed. More information will emerge in talks with county officials and community meetings, Bellows said.
Suncor's move brings the number of bitumen upgrader projects lined up northeast of Edmonton to eight, including six in Sturgeon and two in Strathcona County.
“We're trying to keep our options open,” Bellows said.
Sturgeon is “one of several areas we would consider” for the location of a new plant, and development plans depend partly on results of the regional consultations, he said.
Suncor’s move confirmed a construction wave with potential to keep on accelerating well into the next decade is spreading across mixed farming, industrial and suburban housing districts within about 60 kilometres of downtown Edmonton. The region’s local governments team up to encourage and manage development as the Alberta Industrial Heartland Association.
Work is underway on the first bitumen processing plant in the multi-billion-dollar project lineup, Heartland Upgrader in Strathcona near Fort Saskatchewan.
Petro-Canada earlier this month disclosed plans for seven years of construction by up to 4,500 workers beginning in 2008 in Sturgeon near Redwater.
Suncor’s move into Sturgeon is part of plans to keep on expanding oilsands operations after the scheduled 2012 completion of its $7-billion Voyageur Project near its original plant site 30 kilometres north of Fort McMurray, Bellows said.
Voyageur, which includes a new upgrader and added bitumen extraction, will about double Suncor’s current output to 550,000 barrels per day of premium refinery-ready synthetic oil.
But even at the accelerated 2012 pace, it will take 70 years to produce an estimated 14 billion barrels of “contingent reserves” in the company's 2,000 square kilometres of oilsands leases.
Contingent reserves include known bitumen deposits likely to be produced with current technology, if development programs and regulatory approvals come together with a reasonable period of time. Estimates can increase if technology improves and markets grow.
No other potential locations besides the Edmonton area for the next generation of Suncor oilsands growth were disclosed.
The firm previously studied and rejected potential upgrader sites elsewhere in Canada and the United States, as less economic than the Fort McMurray area where it opened Alberta’s first oilsands plant in 1967.
Production has grown nearly six-fold as a result of staged expansions since the initial 45,000-barrels-daily mining and upgrading complex was built for $240 million.
The Edmonton area has emerged as potentially preferable to the strained Fort McMurray oilsands mining district for the next generation of bitumen processing plants, Bellows indicated.
A Sturgeon County project would locate Suncor's future growth near a larger population of skilled workers, heavy equipment fabrication shops and a pipeline hub expected to grow as the oilsands industry expands, he said.
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