Athabasca Oil Corp. said it has reached an agreement with an Alberta aboriginal group that will pave the way for the Dover oil-sands project, a venture that’s majority owned by PetroChina Co.
The Fort McKay First Nation has agreed to drop its objections to the project, the Calgary-based company said in a statement today. No details on the agreement were provided.
Athabasca rose 11 percent to C$8.74 at the close in Toronto, the most since the shares began trading in April 2010. The stock has gained 35 percent this year.
The Alberta Energy Regulator on Aug. 6 approved the Dover proposal, noting in its 40-page decision that the project won’t have a direct impact on the Moose Lake area, a traditional territory of the Fort McKay First Nation. The aboriginal group had requested a 20-kilometer (12-mile) buffer around the project to protect their traditional hunting territory and argued that the cumulative effects of oil-sands development put their environment at risk.
The Dover project contains reserves of 4.1 billion barrels at a 50 percent recovery rate, the regulator said in August. Athabasca expects production at the site to reach 250,000 barrels a day at full capacity. PetroChina acquired 60 percent of the project in 2010.
The agreement involves commitments by the company to protect the local environment, said Alvaro Pinto, director of sustainability for the Fort McKay First Nation in an interview. The aboriginal group didn’t succeed in winning a buffer around the project, he said.
“The community will be more present in the area to monitor and check that the agreement is being met,” said Pinto.
Andre De Leebeeck, a spokesman for Athabasca, declined to provide more details on the agreement. The project still needs approval from the provincial government, which would trigger a C$1.32 billion ($1.19 billion) put option to sell it to the majority owner, he said.