From Reuters/Calgary Sun
With Canadian benchmark crude near record lows, some major oil sands producers are starting to consider slowing output at their huge thermal operations in northern Alberta, a process fraught with technical and financial difficulties.
Cutting production is one of the least appealing options for producers who have invested billions of dollars and years of work in carefully-engineered bitumen reservoirs and fear doing permanent damage to sites designed to operate for decades.
Two producers, Cenovus Energy and MEG Energy – both among the most efficient producers in the patch – say they do not see the need to act yet, but have plans for reducing volumes if oil prices fell further and stayed there.
Expensive technology needed to pump high-pressure steam to unlock bitumen deposits mean Alberta’s oil reserves – the world’s third-largest – have some of the highest overall production costs, well above the present price of around $18 a barrel for benchmark oil sands crude.
