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

Shots fired during Sylvan Lake and area crime spree

Sylvan Lake RCMP worked with other agencies to arrest four over the long weekend

Sylvan Lake family ‘humbled’ by support as son undergoes cancer treatment

Zane Baker was diagnosed with a brain tumour in 2017 and will now travel to Florida for treatment

Eckville Curling Rink vandalized

Earlier this year the Eckville Library was also vandalized with graffiti

Lacombe Minor Hockey wins Hockey Alberta Association of the Year Award

Skill development, commitment of volunteers and corporate sponsorship fuel success

Alberta RCMP shares tips for motorcycle safety month

Showing off does not pay off – but driving defensively does

VIDEO: Canadian breaks women’s world record for longest plank

Dana Glowacka, of Montreal, held a plank for four hours and 20 minutes

New poll suggests one-third don’t want politicians to wear religious symbols

Local politicians shouldn’t be allowed to wear hijabs, crucifixes or turbans on the job, survey suggests

Raptors fans far from home adjust plans to watch pivotal playoff game

Raptors currently lead the playoff series 3-2, and a win Saturday would vault them into NBA finals

Alberta NDP cries foul as Speaker Cooper names new legislature clerk

Shannon Dean will replace Merwan Saher as the clerk of the assembly effective immediately

‘Her life mattered:’ New trial ordered in death of Indigenous woman Cindy Gladue

In a 4-3 decision, Supreme Court said evidence about Cindy Gladue’s sexual history was mishandled

Emergency funds for High Level evacuees to start flowing by Monday

About 5,000 people in High Level and surrounding communities have been out of their homes for a week

Five takeaways from the Court of Appeal ruling on B.C.’s pipeline law

It’s unclear how many tools are left in B.C.’s toolbox to fight the project

No-vote option: Alberta legislature changing rules to allow MLAs to abstain

The changes are expected to pass, given that Kenney’s party has a majority of seats

Scheer says it would take Conservatives five years to balance budget

Scheeraccused the Liberal government of spending $79.5 billion of previously unbudgeted funds

Most Read