Suncor plans to increase production to 1 million barrels of oil per day and other canadian oil expansions

1. Suncor (Canadian oilsands oil company) aims to increase production to 1 million barrels of oil equivalent per day by 2020 from 2010 production of about 575,000 boe per day. The company plans to increase oil sands production about 10% per year, with total volumes anticipated to increase 8% per year through the end of the decade. Growth will primarily come from continued development of Suncor’s in situ projects, Firebag Stages 3 through 6 and the second stage of MacKay River.

The partnership with Total will play a critical role. Under the terms of the agreement, Total will acquire a 49% interest in Suncor’s 200,000 barrel per day Voyageur upgrader and 19.2% interest in the Fort Hills oil sands project.

Suncor also released 2011 capital expenditure and production guidance. The 2011 capital budget totals CAD 6.7 billion, an increase from an anticipated CAD 5.5 billion for 2010. Capital for growth projects of CAD 2.8 billion primarily will go toward completion of Firebag Stage 3 and continued construction of Stage 4 with expected completion in the late second quarter of 2011 and early 2013, respectively. Both projects have capacity of 62,500 barrels per day.

2. Canadian Oil Sands Trust (COS_u.TO), which has the biggest stake in Syncrude Canada Ltd, said it expects higher production next year from the world’s largest oil sands mining project. It was budgeting annual Syncrude production of 110 million barrels, or 301,400 barrels per day, with a range of 102 million to 115 million barrels for 2011. The production outlook for 2011 represents a five million barrel, or roughly five percent, increase over Canadian Oil Sands’ expected 2010 production.

3. Crscent Point Energy announce dan $800 million capital development expenditures budget for 2011. Execution of the budget is expected to increase average daily production to more than 72,500 boe/d, weighted 90 percent to light and medium crude oil and liquids.

Crescent Point expects to spend approximately 62 percent of its 2011 budget in the Viewfield Bakken area of southeast Saskatchewan, drilling approximately 200 net wells in the area in 2011. To accommodate continued growth of the Company’s Bakken production, Crescent Point expects to invest up to $45 million on infrastructure projects. As part of its ongoing water flood implementation project, the Company expects to convert up to 23 net horizontal wells into water injection wells, increasing the total number of Bakken water injection wells to approximately 36 by year-end 2011.

Execution of the 2011 capital expenditures budget is expected to increase Crescent Point’s average daily production to more than 72,500 boe/d and to provide for exit 2011 production of greater than 75,000 boe/d. This will by 19% higher than the 61,000 BOE/d expected average for 2010.

4. Shell Canada is moving forward with an oilsands mine expansions that will add 100,000 barrels per day of bitumen production to their Jackpine operations which became commercial in September.


he Jackpine mine added capacity to Shell Canada’s existing Muskeg River Mine’s 155,000 barrels of oil equivalent a day. Output at Jackpine is expected to increase to 100,000 barrel per day next year once Shell’s Scotford upgrader is ready for the additional volumes.

In October Shell nixed plans to build a new upgrader near Scotford, saying the company would focus instead on making existing plants more efficient.

The corporation’s proposed 200,000-barrel-per-day Pierre River mine project would be located across the Athabasca River from Jackpine.

Neither Pierre River nor the Jackpine expansion have been sanctioned by parent Royal Dutch Shell PLC, which is awaiting regulatory approvals

5. Seeking Alpha – What are some companies with exposure to the Bakken in Montana, Alberta and Saskatchewan?

In North Dakota, there is Arsenal Energy Inc. (AEYIF.PK), NuLoch Resources Inc. (NULCF.PK) and TriOil Resources Ltd. (TRIAF.PK).

In Montana, there is Primary Petroleum (PETEF.PK), Rosetta Resources Inc. (ROSE), Newfield Exploration Company (NFX) and Anschutz Exploration Corp.

In Alberta, companies targeting the Alberta Basin Bakken include Crescent Point Energy Corp. (CSCTF.PK), which has perhaps the largest land position. There is also Murphy Oil Corp. (MUR), Royal Dutch Shell Plc (RDS.A) and PetroBakken Energy Ltd. (PBKEF.PK). On the smaller side, DeeThree Exploration Ltd. (DTHRF.PK), Bowood Energy Inc. (ROAOF.PK) and Argosy Energy Inc. (AYEYF.PK) are three juniors that are playing that space.

In Saskatchewan, that list can be longer. Crescent Point and Petrobakken are the two big dogs there. In addition, there’s Legacy Oil & Gas Inc. (LEGPF.PK); Spartan Exploration Ltd. (SXPRF.PK) has a big land position for its size; and Painted Pony Petroleum Ltd. (PDPYF.PK) is active in the area. Then there are the trusts: ARC Energy Trust (AETUF.PK), NAL Oil & Gas Trust (NOIGF.PK) and Advantage Oil and Gas Ltd. (AAV).

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