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Cnooc Canadian Oil-Sands Plant to Shutdown Amid Pipeline Probe

CALGARY, Alberta—The Canadian unit of Chinese state-controlled energy giant Cnooc Ltd. CEO 0.69 % said Wednesday it will halt production at a 50,000 barrel-a-day oil-sands plant indefinitely as part of its effort to comply with an order from regulators forcing it to shut down pipelines at the site. The move comes after the chief energy regulator in the Western Canadian province last week suspended operating licenses affecting 95 pipelines at Cnooc subsidiary Nexen Energy ULC’s Long Lake heavy oil extraction facility in northern Alberta for suspected failure to comply with certain rules . Shutting down Long Lake is the latest in a string of setbacks at the plant , which started up in 2008 but has never reached its capacity of 72,000 barrels a day. The loss of output is a blow to parent company Cnooc, which bought Nexen for $15 billion in 2013 and installed its own management […]

Posted On : Published By : Tom Whipple
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Production Woes at Oil-Sands Giant Syncrude to Impact Full-Year Output

By Chester Dawson CALGARY, Alberta– Canadian Oil Sands Ltd., the largest owner of the giant Syncrude oil-sands project, said Wednesday that production of synthetic crude would be "minimal" for two weeks after a weekend fire at Syncrude’s main plant, and that the lost production would impact its annual output. The company halted production after a blaze on Saturday damaged equipment at its Mildred Lake strip mine’s crude processing facility in northern Alberta. The loss of some 200,000 barrels per day of output has contributed to a sharp spike in prices of Canadian synthetic oil this week. "Syncrude plans to implement a phased recovery strategy with minimal synthetic crude oil shipments and operating rates for the next two weeks, " Canadian Oil Sands said in a statement late Wednesday. Production is expected to return to more normal levels at the end of the month, it said. The company said that […]

Posted On : Published By : Tom Whipple
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Two New Canadian Oil Sands Projects Started Despite Price Pain

CALGARY, Alberta, Sept 1 (Reuters) – ConocoPhillips and Husky Energy Inc announced key milestones in bringing two new oil sands projects online on Tuesday, underlining how some producers in the high-cost sector are boosting production even as crude prices tumble. The two projects will add around 178,000 barrels per day to the 2.3 million bpd already being produced from the oil sands, the world’s third largest crude reserves after Saudi Arabia and Venezuela. The Canadian Association of Petroleum Producers forecast in June that oil sands production to hit 3.1 million bpd in 2020. That forecast may be overstated however, as Imperial Oil has since delayed plans to expand its Kearl project by another 125,000 bpd. The start up announcements on Tuesday also come as around 900 oil company jobs were cut in Canada, 500 of those by ConocoPhillips, and the U.S. benchmark crude dropped more than 6 percent on […]

Posted On : Published By : Tom Whipple
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Canadian producer Penn West slashing jobs

Canadian oil and gas producer Penn West shedding more than 400 jobs to ensure durability during weak crude oil market. File photo by ekina/Shutterstock CALGARY, Alberta, Sept. 1 (UPI) — Canadian oil and gas producer Penn West Petroleum said it would cut more than 400 jobs, or around 35 percent of its workforce, to endure a weak oil market. The company said it was cutting capital spending, suspending dividends and "significantly" cutting costs through a 35 percent workforce reduction. President and Chief Executive Officer Dave Roberts said steps taken today will help the company endure an era of historically low crude oil prices. "Limiting our capital programs to the funds flow generated from our assets and suspending our dividend are necessary steps," he said in a statement. "We remain flexible and well positioned to move forward when oil prices improve." The company said it expects to save about $34 […]

Posted On : Published By : Tom Whipple
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Canada orders Alberta pipeline closures

Canada issues suspension order for Nexen pipeline systems amid mounting safety concerns. Photo by Heather Snow/Shutterstock CALGARY, Alberta, Aug. 31 (UPI) — Canadian energy company Nexen said safety was its top priority after a provincial regulator ordered dozens of pipelines closed because of maintenance issues. The Alberta Energy Regulator issued a suspension order to Nexen Energy, a Canadian subsidiary of the China National Offshore Oil Corp., calling on the company to shut down more than 90 of its oil and gas networks after the company was found to be in non-compliance with federal regulations. The order came after last month’s report of a failure on the company’s Long Lake pipeline network in the province. About 31,000 barrels of a mixture of oil, water and sand spilled in Alberta from the system. "Given that this company has already had a pipeline failure at this site, the AER will not lift […]

Posted On : Published By : Tom Whipple
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Canadian Oil Sands Halts Crude Production at Oil-Sands Giant Syncrude

A dump truck is loaded with oil sands at the Syncrude Canada Ltd. mine. CALGARY, Alberta— Canadian Oil Sands Ltd. COSWF 2.60 % , the largest owner of the giant Syncrude oil-sands project, said on Sunday that it has halted production after a fire damaged equipment at its synthetic crude oil processing facility in northern Alberta. The company said the fire, which occurred early Saturday and was extinguished without any injuries, affected pipes connected to a water treatment unit at Syncrude’s heavy oil upgrader on the site of its Mildred Lake oil-sands surface mine. The cause of the blaze is under investigation, it said. While the upgrader’s core machinery wasn’t damaged and the strip mine continues to operate, Canadian Oil Sands said in a statement issued late Sunday that “synthetic crude oil production has been temporarily suspended while a recovery and repair strategy are being developed.” Canadian Oil Sands […]

Posted On : Published By : Tom Whipple
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Canada’s Oil-Dependent Alberta Province Projects Record Deficit

CALGARY, Alberta—The government of Alberta said Monday its deficit will hit record levels due to the swoon in crude oil prices and an economic slowdown and will consider increasing taxes to reduce that budgetary shortfall. Finance Minister Joe Ceci said Alberta expects the deficit to grow to an all-time high of 5.9 billion Canadian dollars ($4.5 billion) in the fiscal year that began April 1. He said the deficit could hit C$6.5 billion if oil prices remain low, reflecting the province’s reliance on crude production as its chief engine of growth. “There is no doubt that our big challenge is commodity prices that our government in Alberta does not control,” Mr. Ceci said at a news conference in the provincial capital of Edmonton. “No one expected global oil prices to reach levels that they’re at today,” he told reporters. The deficit in Alberta is a poor omen for Canada […]

Posted On : Published By : Tom Whipple
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Canadian Oil Sands Halts Crude Production at Oil-Sands Giant Syncrude

A dump truck is loaded with oil sands at the Syncrude Canada Ltd. mine. CALGARY, Alberta— Canadian Oil Sands Ltd. COSWF 2.60 % , the largest owner of the giant Syncrude oil-sands project, said on Sunday that it has halted production after a fire damaged equipment at its synthetic crude oil processing facility in northern Alberta. The company said the fire, which occurred early Saturday and was extinguished without any injuries, affected pipes connected to a water treatment unit at Syncrude’s heavy oil upgrader on the site of its Mildred Lake oil-sands surface mine. The cause of the blaze is under investigation, it said. While the upgrader’s core machinery wasn’t damaged and the strip mine continues to operate, Canadian Oil Sands said in a statement issued late Sunday that “synthetic crude oil production has been temporarily suspended while a recovery and repair strategy are being developed.” Canadian Oil Sands […]

Posted On : Published By : Tom Whipple
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Canada’s oil diversity may be paying off

Canadian oil export data suggests healthy balance in an era of low crude oil prices. Photo by Heather Snow/Shutterstock CALGARY, Alberta, Aug. 27 (UPI) — Canadian crude oil exports in the depressed energy market were down for conventional oil but up for heavier oil sands, national data show. The National Energy Board reported exports of lighter conventional crude oil down 25 percent from January to 772,000 barrels per day in June. Compared with June 2014, total light crude oil exports are down 10 percent. For the heavier oil sands , however, NEB data show a 6 percent increase from January to 2.2 million bpd in June and up 13.5 percent year-on-year. In July, NEB released its report on full-year 2014 production. Though crude oil prices fell roughly 50 percent from June 2014 to year’s end, the NEB said the energy sector was resilient and export revenue of $100 billion […]

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Western Canadian Crude Oil Stockpiles Rise to a Record

Stockpiles of Western Canadian crude reached a new high last week, according to a report from a leading energy market data provider, in a further sign of the North American oil glut rising as energy prices fall. The rapid rise in inventory, which may worsen the price discount between Western Canadian and other crudes, comes as global demand for oil hasn’t kept up with the pace of production increases. Oil prices have slumped to six-year lows in recent trading, prompting North American producers to park more crude in storage tanks as they wait out the slump in the hopes of a rebound in demand and prices. Storage levels in Western Canada, which includes several tank farms in the oil-rich province of Alberta, rose 10% on the week to a record of 27 million barrels as of August 21, according to data from Genscape of Louisville, Ky. That topped the […]

Posted On : Published By : Tom Whipple