“Startup of the initial phase of the Kearl oil-sands project is imminent,” Calgary-based Imperial Oil said in a statement today. The Alberta project, which will have initial output of about 110,000 barrels a day and expand to 345,000, was expected to start late last year. The company has been saying for weeks that first oil was expected soon.
The price of Western Canada Select for next-month delivery strengthened 35 cents to a $17.25-a-barrel discount to U.S. West Texas Intermediate, according to Calgary oil broker Net Energy Inc. The grade is a heavy blend that includes diluted oil-sands bitumen similar to the type that will be produced at Kearl.
The timing of sales is later than than some analysts estimated. Greg Pardy, a Toronto-based analyst at RBC Capital Markets, said in a note today he’d expected sales to begin in the second-quarter. In an interview this month, Michael Dunn, an analyst with FirstEnergy Capital Corp., said there was a risk sales would slip into the third quarter, which would support June spot-market prices.
Shipments from Kearl will begin 60 to 90 days after first oil is produced, to give Imperial time to fill tanks and pipelines, Pius Rolheiser, a company spokesman in Calgary, said in an April 9 e-mail. Imperial, the largest Canadian oil producer after Suncor Energy Inc. (SU), is a subsidiary of Exxon Mobil Corp. (XOM)
The price of Syncrude, a light oil produced from oil-sands upgraders, was unchanged at a $3 premium to WTI as of 12:30 p.m. New York time, Net Energy said.
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