Ivanhoe Energy and SBM Offshore Sign Alliance to Accelerate Development of
Un-tapped Offshore Heavy Oil Resources
CALGARY, March 20, 2013
Alliance represents another significant step to commercialize HTL
CALGARY, March 20, 2013 /PRNewswire/ - Ivanhoe Energy (TSX: IE) (NASDAQ: IVAN)
and SBM Offshore (SBM) are pleased to announce they have formed a global
strategic alliance (Alliance), combining their respective expertise to create
Floating, Production, Upgrading, Storage and Offloading vessels (FPUSO's).
The two companies have combined their respective technologies and experience
to produce a first of its kind design for offshore facilities that will
economically produce and upgrade heavy oil from offshore fields with crude oil
quality down to 10^°API gravity, or lower. "We expect this combination of
technologies to become the pre-eminent method for producing and upgrading
heavy oil at offshore locations around the world," said Michael Wyllie, SBM
Chief Technology Officer.
Industry experts have estimated that offshore heavy oil resources exceed 500
billion barrels recoverable. Given the global abundance of such oil deposits
and depleting conventional oil supplies, this Alliance creates significant
potential for the offshore heavy oil sector.
SBM is a publicly traded, world leader in providing offshore Floating,
Production, Storage, and Offloading (FPSO) vessels. With a market cap of over
US$ three billion and over 7,000 employees, SBM currently has around 1 million
barrels of throughput per day from a fleet of 16 production systems in
Ivanhoe Energy's Heavy-to-Light (HTL) process is a partial upgrading
technology that drastically reduces the viscosity of stranded heavy oil
resources and produces a high quality synthetic crude oil that commands
greater value from refineries around the world. In addition to creating
operating efficiencies, the technology will greatly improve the economics of
heavy oil development. HTL's small footprint and modularization capability
makes installation on FPSOs possible.
Moreover, by providing a source of lighter oil on the FPUSO, some of this
fluid can be re-circulated back to the subsea wells, providing a robust
solution to overcome the flow assurance challenges of subsea heavy oil wells.
This important feature can be an enabler for heavy oil field developments,
especially those in deep water.
"Ivanhoe Energy and SBM collaborated over the last two years to develop this
new concept," said Dr. Michael Silverman, Ivanhoe Energy Chief Technology
Officer. "In 2012, with engineering support from AMEC Engineering, we
completed the conceptual design of an offshore FPUSO facility that will
upgrade up to 60,000 barrels per day."
The Alliance is exploring a number of potential business models and
applications. Given the number of existing and potential FPSOs, this Alliance
is another important avenue to commercialize the HTL process in the near term.
Ivanhoe Energy is an independent international heavy oil exploration and
development company focused on pursuing long-term growth in its reserves and
production using advanced technologies, including its proprietary heavy oil
upgrading process (HTL^TM). Core operations are in Canada, United States,
Ecuador and Mongolia, with business development opportunities worldwide.
Ivanhoe Energy trades on the Toronto Stock Exchange with the ticker symbol IE
and on the NASDAQ Capital Market with the ticker symbol IVAN. For more
information about Ivanhoe Energy Inc. please visit www.ivanhoeenergy.com.
FORWARD-LOOKING STATEMENTS: This document includes forward-looking statements,
including forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements include,
but are not limited to the potential for commercialization and future
application of the heavy oil upgrading technology and other technologies,
statements relating to the continued advancement of Ivanhoe Energy's projects,
statements relating to the timing and amount of proceeds of agreed upon and
contemplated disposition transactions, statements relating to anticipated
capital expenditures, statements relating to the timing and success of
regulatory review applications, and other statements which are not historical
facts. When used in this document, the words such as "could," "plan,"
"estimate," "expect," "intend," "may," "potential," "should," and similar
expressions relating to matters that are not historical facts are
forward-looking statements. Although Ivanhoe Energy believes that its
expectations reflected in these forward-looking statements are reasonable,
such statements involve risks and uncertainties and no assurance can be given
that actual results will be consistent with these forward-looking statements.
Important factors that could cause actual results to differ from these
forward-looking statements include the potential that the Company's projects
will experience technological and mechanical problems, new product development
will not proceed as planned, the HTL^TM technology to upgrade bitumen and
heavy oil may not be commercially viable, geological conditions in reservoirs
may not result in commercial levels of oil and gas production, the
availability of drilling rigs and other support services, uncertainties about
the estimates of reserves, the risk associated with doing business in foreign
countries, environmental risks, changes in product prices, our ability to
raise capital as and when required, our ability to complete agreed upon and
planned asset dispositions, competition and other risks disclosed in Ivanhoe
Energy's 2012 Annual Report on Form 10-K filed with the U.S. Securities and
Exchange Commission on EDGAR and the Canadian Securities Commissions on SEDAR.
SOURCE Ivanhoe Energy Inc.
Manager, Corporate Communications
(403) 817 1108
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