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Oil Sands Output Rises as Canadian Crude Falls Below $40

Canadian heavy crude traded below $40 a barrel for the first time in five years just as surge of new projects are scheduled to start operation. A total of 14 new oil sands projects are scheduled to start next year with a combined capacity of 266,240 barrels a day, according to data published by Oilsands Review. That’s 36 percent more than was started in 2014. Oil futures have dropped more than 40 percent since June as production surged in the U.S. and Canada , adding to OPEC output that exceeded the group’s target for six consecutive months. OPEC decided to maintain its production level at a Nov. 27 meeting, resisting calls from members including Venezuela to reduce supply. “There is a lot of crude coming on next year,” Juan Osuna, IHS Energy Inc.’s senior director for North American oil said in a phone interview Dec. 12. Producers “aren’t going […]

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Canada Heavy Oil Nearing $40 Threatens Oil Sands Projects

Canadian heavy crude fell to near $40 a barrel, threatening projects under construction as producers boosted output and space on a pipeline was rationed. Imperial Oil Ltd. (IMO) is increasing output at its Kearl oil sands project to 110,000 barrels a day after a shutdown last month, Pius Rolheiser, a Calgary-based spokesman, said by phone yesterday. Enbridge Inc. apportioned space on the Spearhead pipeline, which carries Canadian crude south to Cushing, Oklahoma , after demand to ship on the line exceeded capacity, according to a company statement. Heavy West Canadian Select rose 82 cents to $43.01 a barrel after falling to $42.19 a barrel yesterday, the lowest since April 2009, data compiled by Bloomberg showed. Crude has fallen into a bear market as U.S. output surges to the highest in more than three decades. Calgary-based Cenovus Energy Inc. (CVE) said today it “substantially” slowed development plans at the Narrows […]

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Imperial Oil Restarts Production at Kearl Oil Sands Mine

CALGARY, Alberta— Exxon Mobil Corp. ’s Canadian subsidiary on Tuesday said it has resumed production at one of its largest oil sands mines “to pre-shutdown levels” after it halted operations in November due to a mechanical problem. Imperial Oil Ltd. suspended production three weeks ago after detecting a vibration issue in the mine’s core ore-crushing machinery used to extract heavy oil. That forced it to forgo output, which had averaged 92,000 barrels of crude a day in the third quarter excluding a 14-day maintenance window. “Repairs to the crusher unit have been completed,” and the company is still looking into the cause of the equipment malfunction, Imperial spokesman Pius Rolheiser said. The Kearl plant cost 13 billion Canadian dollars ($11.4 billion) and started production in April 2013 after a series of delays and cost overruns. Construction of an C$8.9 billion expansion to produce an additional 110,000 barrels a day […]

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The Other Oil Sands Fight: It’s in Utah and Involves Citrus

URL: http://www.rigzone.com/news/oil_gas/a/136169/The_Other_Oil_Sands_Fight_Its_in_Utah_and_Involves_Citrus CALGARY, Alberta, Dec 1 (Reuters) – While North America has been gripped by controversy over the Keystone XL pipeline that would ship crude to the United States from the Canadian oil sands, a small Canadian company has been quietly digging in the oil sands of Utah with a secret weapon it thinks may end the environmental argument: citrus. U.S. Oil Sands Inc says its method will cut the cost and reduce the energy needed to separate oil from sand, lowering the environmental impact. Opponents are far from convinced. The Calgary-based firm is developing its PR Spring project on a 32,000-acre lease about 280 kilometers (174 miles) southeast of Salt Lake City. It plans to start producing 2,000 barrels per day next year with the potential to reach 10,000 barrels per day. Its patented technology uses a solvent whose main ingredient is derived from orange and lemon peels. […]

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IEA Chief Economist Urges Oil Producers to Invest in New Projects

Petroleum storage tanks at the Suncor tar sands operations near Fort McMurray, Alberta, Canada. IEA… ENLARGE Petroleum storage tanks at the Suncor tar sands operations near Fort McMurray, Alberta, Canada. IEA has singled out Canada as a key focus area for future oil production. Reuters MADRID—The International Energy Agency’s chief economist on Friday urged oil producers to boost investment in new projects to meet an anticipated rise in demand, a move that he said may avoid oil price spikes in coming years. Speaking in Madrid during the presentation of the IEA’s annual report, Fatih Birol said that a tumble in oil prices makes it hard to believe a supply crunch may happen any time soon, but the slow pace of development of new projects makes it imperative to act. “We shouldn’t just ignore tomorrow’s challenges,” Mr. Birol said. “This is hard point to make in this context of lower […]

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Alberta Producers With World’s Cheapest Oil Face Cascading Woes

Canada ’s biggest energy producers now face the same prospects of shrinking budgets and declining profit as their smaller rivals as prices drop for what’s already the world’s cheapest oil. Producers including Suncor Energy Inc. (SU) and Canadian Natural Resources Ltd. (CNQ) , which each fell the most in at least three years yesterday, operate in one of the most expensive places on earth to produce oil. If crude prices continue sinking following OPEC’s decision not to cut global oil supplies, Canada’s producers big and small will have to tighten their belts to prepare for declining profits. “This is a pretty big shock,” said Justin Bouchard, an analyst at Desjardins Securities Inc. in Calgary. “There’s no question there’s going to be a slowdown. Even the big guys will have to look at their capital spending plans.” Western Canada Select, the Canadian benchmark, has lost more than a third of […]

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A cleaner way to get petroleum out of oil sands

4727 Votes The secret to business is buy low and sell high. Canadian holding company MCW Energy Group hopes to do that by economically separating the petroleum from oil sands and then selling it at market rates of double to triple the processing costs. The company uses a patented closed-loop technology that treats the sands with a solvent that helps remove the oil. The oil and solvent are separated, with the latter recycled for the next batch of production. According to CEO Gerald Bailey, the finished sand is 99.9 percent clean and can be put back on the ground. The company currently has 1,000 acres in Vernal, Utah, about a 173-mile drive east of Salt Lake City. “Those sands run about 12 percent oil,” said Bailey, who has a doctorate in chemical engineering. “It looks like black sand. You can pick it up and it’s dry, but it’s dirty […]

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Canadian Heavy Oil Boosted as Imperial Shuts Kearl Operation

Canadian heavy oil strengthened the most in more than a month after Imperial Oil Ltd. (IMO) shut operations at its Kearl oil sands project. Operations were suspended after vibrations were detected in an ore crusher unit at the site, the company said in an e-mailed statement. The shutdown will last “several weeks” and customers will be supplied from inventories and through purchases of crude on the market, spokesman Pius Rolheiser said by phone. Imperial was producing 92,000 barrels a day at Kearl in the third quarter, the company said. Western Canadian Select, a heavy blend that is a benchmark for oil-sands production, strengthened by $1 a barrel to a $15.10 discount to West Texas Intermediate at 11:48 a.m., according to data compiled by Bloomberg. “This should help support prices,” John Auers , vice president of the Dallas-based consulting company Turner Mason & Co., said by telephone. “It’s not super […]

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Outrage over EU proposal on tar sands

EU proposals on Canadian crude oil draws criticism from environmental circles. UPI/Brian Kersey LONDON, Oct. 8 (UPI) — Advocates for a low-carbon economy cried foul over a European decision to ease restrictions on oil sands produced from Canadian fields. The European Commission ruled Tuesday to pull back on some of the low-carbon policies governing oil sands. The Canadian government has lobbied for the measure as it tries to diversify an export economy based almost exclusively on the United States. Caroline Lucas, a member of the British Parliament for the Green Party, told the Independent newspaper the European decision was shameful. "It completely defies reason, enormous public opposition and paves the way for big business to profit from gross exploitation of the earth’s resources," she said in comments published Tuesday. "Tar sand oil is one of the dirtiest, most polluting fuels." Oil produced from Canada is said to be more […]

Posted On : Published By : Tom Whipple