- About Us
- About Oil Sands
- Chip Lake Road
- Media & Press
- Corporate Responsibilities
Laricina Energy Ltd. (“Laricina” or the “Company”) today announced the Company has received Order in Council from the Government of Alberta for the Company’s planned Saleski Project Phase 1 expansion (“Saleski Phase 1”). The Saleski project is located in the west Athabasca region of Alberta, approximately 100 kilometres southwest of Fort McMurray where the development plan targets the Grosmont Formation, a bitumen carbonate. Saleski Phase 1 will use a combination of cyclic steam-assisted gravity drainage (“C-SAGD”) and solvent-cyclic SAGD (“SC-SAGD”).
“Our Saleski Phase 1 application was the first commercial-scale bitumen project to be submitted to the regulators targeting the Grosmont Formation and will be industry’s first commercial project operating in this fractured carbonate reservoir,” said Glen Schmidt, President and Chief Executive Officer. “Saleski Phase 1 will also be Laricina’s largest project expansion at the time it is put on-stream. We thank the regulators and Government of Alberta for working with us towards regulatory approvals, a critical next step for both industry and the province in the development of this massive untapped resource.”
Saleski Phase 1 is designed for 10,700 gross barrels per day production capacity and is expected to produce at approximately 92 percent of that design capacity once it reaches sustained operations and peak production.
With the Order in Council received and other regulatory approvals imminent, Laricina will focus on financing strategies for the advancement of Saleski Phase 1 and maintaining its project schedule. Initial engineering process design is underway including procurement of longer lead equipment items. The Company continues to refine its capital cost estimate for Saleski Phase 1 and is currently forecasting $520 million gross ($312 million net). This most recent reduced cost estimate has been achieved by down-sizing the well pad and manifold configurations, reducing the initial well count to 20 single wells, and reducing the overall size of the footprint from the initial design. Additionally, wherever possible the construction strategy for Saleski Phase 1 will use lump-sum agreements to manage inflation and increase cost certainty.
Laricina’s Saleski pilot has been producing bitumen from the Grosmont since 2011 and has demonstrated commercial production rates. Data from the pilot has shaped the operational design and recovery process planned for Saleski Phase 1 and continues to provide critical information for the long-term development of the Grosmont Formation.
Future development phases at Saleski i target gross production capacity of 282,500 barrels per day with Phase 2 at 30,000 barrels-per-day and Phases 3 through 6 each at 60,000 barrels-per-day each. Similar to Laricina’s Germain Project development strategy, timing of future phases at Saleski is dependent upon financing and managing activity levels and corporate resources between projects.
Following is a detailed description of Saleski Phase 1 and certain project highlights:
(1) See pages 41-45 in Laricina Energy Ltd.’s 2012 Annual Report for a description of its reserves and resources based on the report of GLJ Petroleum Consultants Ltd. regarding Laricina’s properties effective December 31, 2012. Please also refer to “forward-looking statements” in this information release.
About Laricina Energy Ltd.
Laricina is a non-public, Calgary based, responsible energy company that will contribute supply to the growing demand for crude oil through in situ oil sands development.
Laricina’s goal is to create value by developing Canada’s oil sands using innovative in situ technologies. The Company has a diverse portfolio of oil sands assets at varied stages of development, and experienced people with the requisite technical expertise. Laricina has identified five core areas with commercial production potential in excess of 600,000 gross barrels of bitumen per day from a large concentrated resource base with 387 million barrels of probable reserves and 4.6 billion barrels of contingent plus prospective resources (best estimate) as determined by Laricina’s independent reservoir engineers. These assets include oil sands resources in the familiar McMurray Formation, and the developing Grand Rapids, and Grosmont and Winterburn carbonate plays, all of which offer significant production potential.
This information release contains certain “forward-looking statements” within the meaning of such statements under applicable securities law including but not limited to final regulatory approval from the Energy Resources Conservation Board and Alberta Environment. Forwardlooking statements are frequently characterized by words such as “plan”, “expect”, “estimate”, “intend”, “believe”, “anticipate” and other similar words, or statements that certain events or conditions “may” or “will” occur. Forward-looking statements are based on Laricina’s experience and current beliefs as well as assumptions made by, and information currently available to, Laricina, and are subject to a variety of risks and uncertainties including, but not limited to, those associated with resource definition, unanticipated costs and expenses, regulatory approvals, fluctuating oil and gas prices, and the ability to access sufficient capital to finance future acquisitions and development. Although the Company believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned that the assumptions and factors discussed in this information release are not exhaustive and readers are not to place undue reliance on forward-looking statements. Laricina disclaims any intention or obligation to update or revise any forward-looking statements as a result of new information, future events or otherwise, subsequent to the date of this message, except as 2 required under applicable securities legislation. The forward-looking statements are expressly qualified by these cautionary statements.
For further information please contact:
Marla Van Gelder
Vice President Corporate Development
Laricina Energy Ltd.
East Tower, 5th Ave Place
800, 425 1st Street SW
Calgary, AB. T2P 3L8