While Pan Canadian Petroleum Limited has been given Energy Conservation Board (ERCB) approval for phase one of a proposed three phase commercial oil sands project in the Elk Point area, in all likelihood ‘the depressed oil market will see major expenditures for the project held up until at least 1989. George Little, Pan Canadian’s corporate secretary, pointed out that while the company still plans to proceed with the project in the future, present oil prices make it economically unwise to pursue immediate development. “At the time when we applied to the ERCB for approval the economic conditions in the oil industry were a little different from what they are now,” Little said.
But if and when it does go ahead the total capital expenditure on the project, with a life span of 20 years, is expected to reach the $91 million mark. The average size of the work force, on an annual basis, over the project life will range from 12 to 34 people.
The ERCB approval authorizes a reduction in well spacing to 16 hectares from 64 hectares for seven sections of land, and a cyclic steam stimulation process to be used in two sections of land based on four-hectare well spacing. Fresh water required for the cyclic steam process will be obtained from the North Saskatchewan River using the Westmin hectares from 64 hectares for seven sections of land, and a cyclic steam stimulation process to be used in two sections of land based on four-hectare well spacing. Fresh water required for the cyclic steam process will be obtained from the North Saskatchewan River using the Westmin Resources Limited water pipeline system. Once completed, phase one of the project will produce an average of 500 cubic metres of bitumen per day and will incorporate 113 existing wells with another 165 wells to be drilled over the next 20 years. The ERCB is able to withdraw approval of any parts of the project for which construction has not commenced after three years, Little said.
