Imperial Oil president and CEO Rich Kruger prepares to address the company’s annual meeting in Calgary, Friday, April 28, 2017.THE CANADIAN PRESS/Jeff McIntosh

Imperial Oil slows development of Aspen project, cites Alberta production cuts

Project was previously projected to add 75,000 barrels per day of bitumen production

Imperial Oil Ltd. has slowed the development of a $2.6-billion oilsands project because of uncertainty due to the Alberta government’s oil production curtailment program and other challenges.

First production from the Aspen in-situ project had been expected in 2022 but will now likely be delayed by at least one year, Imperial said Friday.

The project was previously projected to add 75,000 barrels per day of bitumen production to Imperial’s output of about 300,000 bpd.

The Calgary-based company — an integrated producer and refiner — sanctioned the project in November, after receiving provincial approval but before the Alberta government announced a production curtailment program effective Jan. 1.

The province mandated the production cuts in an effort to reduce a price discount on oil produced in Western Canada.

READ MORE: Alberta rail plan results from oil curtailment plan mistakes, Husky execs say

Rich Kruger, Imperial’s chairman, president and chief executive, said in a statement that the decision to delay the Aspen project was a difficult choice, given that it had received a green light to proceed only in November.

“However, we cannot invest billions of dollars on behalf of our shareholders given the uncertainty in the current business environment,” he said.

“That said, our goal is to ensure the work we do this year will enable us to effectively and efficiently resume planned activity levels when the time is right.”

He added that the decision to return to planned project activity levels will depend on factors such as “any subsequent government actions related to curtailment and our confidence in general market conditions.”

The Alberta government initially ordered production of raw crude oil and bitumen to be cut by 325,000 barrels per day to deal with low prices.

Since then, the province has eased the mandatory production cuts as the discount for Western Canadian Select bitumen-blend oil compared with New York-traded West Texas Intermediate has fallen.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

Stettler dancers land amazing experiences in the ‘Big Apple’

Hailie Ripley and Elisa Collard will soon be jetting off to New York City

Calgary’s Erin Ross featured at Entertainment in the Park July 24th

Ross has performed several times in past years at the popular event

Ponoka RCMP investigate motorcycle crash resulting in fatality

On July 13th, the man succumbed to his injuries while in the hospital

Castor resident meets award-winning namesake

Luella Kowalsky, who is a resident of Castor’s Paintearth Lodge, met ‘Miss Luella’ recently

Joaquin ‘El Chapo’ Guzman sentenced to life in prison

Experts say he will likely wind up at the federal government’s Supermax prison in Florence, Colorado

Natural gas producers demand government action in open letter to Kenney

The letter warns that the viability of the natural gas sector is in jeopardy

Remains of missing Edmonton woman discovered outside of North Battleford: RCMP

The 25-year-old Edmonton woman was reported missing on May 12

Companies to appear before panel today in public inquiry into B.C. gas prices

A three-member panel by B.C. Utilities Commission will listen to up to four days of oral hearings

Interviews with family of highway shooting victim heard in Calgary court

Horst Stewin’s relatives were set to testify by video from Germany this morning, but a court translator said she was unable to proceed

Lower gas prices slow annual inflation rate to Bank of Canada’s 2% bull’s-eye

Prices showed strength in other areas — led by a 17.3 per cent increase in the cost of fresh vegetables

Special memorial service to say goodbye to murdered Kelowna teen

A memorial service and celebratio of life was held Tuesday for murdered teen Elijah-Iain Beauregard

RCMP investigating alleged ‘sexual misconduct’ by cyclist on BCIT campus

BCIT said they were reviewing video evidence of the incident

Graphic suicide scene edited out of ‘13 Reasons Why’ finale

Suicide prevention groups support the decision

Most Read