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CALGARY - Suncor Energy Inc.` spostponed in situ expansion will likely be the next oilsands project to be taken off the shelf, observers agreed Wednesday, noting rising oil prices and falling costs are boosting optimism in the sector.
On Monday, Imperial Oil Ltd. confirmed its $8-billion, 110,000-barrel-per-day Kearl oilsands mine 70 kilometres north of Fort McMurray will proceed, adding that it has shaved between $500 million and $1 billion off what it would have cost last summer.
On Wednesday, benchmark light crude oil rose $1 to close at $63.45 US per barrel. Oil has traded below $34 this year after hitting a record $147 last summer.
William Lacey, an oilsands analyst with FirstEnergy Capital Corp., said Suncor`s stalled Firebag 3 thermal project, placed in "safe mode" in January along with its Voyageur upgrader, could be back in business before the end of the year.
"I think Suncor will probably be the next major one announced, with Fire-bag 3 put back on the books because there`s only a little over$1 billion left to be spent to bring on 70,000 bpd of production," he said.
He said the pending merger with Petro-Canada, to be voted on by shareholders next week, will give Suncor additional clout in financial markets.
Wilf Gobert, an independent Calgary oil analyst, agreed that Suncor, whose $20.9-billion Voyageur suite of projects was halted with $7 billion already invested, is a good bet to be next out of the gate.
"I think the bellwether project with the combination of oil prices going up and costs coming down is going to be Suncor`s decision on resuming expenditures," he said.
He said he doesn`t think those spending decisions will take place soon.
William Lee, an analyst for CIBC World Markets, said he doesn`t think any of the cancelled projects will be green-lighted this year.
"The earliest I can see is probably 2010.I don`t think anything major will be sanctioned other than Kearl."
Read the full article here.
On Monday, Imperial Oil Ltd. confirmed its $8-billion, 110,000-barrel-per-day Kearl oilsands mine 70 kilometres north of Fort McMurray will proceed, adding that it has shaved between $500 million and $1 billion off what it would have cost last summer.
On Wednesday, benchmark light crude oil rose $1 to close at $63.45 US per barrel. Oil has traded below $34 this year after hitting a record $147 last summer.
William Lacey, an oilsands analyst with FirstEnergy Capital Corp., said Suncor`s stalled Firebag 3 thermal project, placed in "safe mode" in January along with its Voyageur upgrader, could be back in business before the end of the year.
"I think Suncor will probably be the next major one announced, with Fire-bag 3 put back on the books because there`s only a little over$1 billion left to be spent to bring on 70,000 bpd of production," he said.
He said the pending merger with Petro-Canada, to be voted on by shareholders next week, will give Suncor additional clout in financial markets.
Wilf Gobert, an independent Calgary oil analyst, agreed that Suncor, whose $20.9-billion Voyageur suite of projects was halted with $7 billion already invested, is a good bet to be next out of the gate.
"I think the bellwether project with the combination of oil prices going up and costs coming down is going to be Suncor`s decision on resuming expenditures," he said.
He said he doesn`t think those spending decisions will take place soon.
William Lee, an analyst for CIBC World Markets, said he doesn`t think any of the cancelled projects will be green-lighted this year.
"The earliest I can see is probably 2010.I don`t think anything major will be sanctioned other than Kearl."
Read the full article here.