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Laricina is pleased to announce it has received Order in Council approval from the Alberta Government for its Germain 5,000-barrel-per-day Commercial Demonstration solvent-cyclic steam-assisted gravity drainage (SC-SAGD) project.
Germain is located within the West Athabasca oil sands region and lies approximately 130 kilometres southwest of Fort McMurray, Alberta. The Germain Project consists of the 5,000 barrel-per-day Commercial Demonstration phase followed by a series of expansions to ultimate capacity of more than 200,000 gross barrels per day. The Germain Project has a long reserve life in excess of 25 years within two prospective reservoirs: the Grand Rapids Formation, a Cretaceous sand, and the Devonian Winterburn Group, a carbonate. The Germain Project is estimated to contain 1.7 billion barrels of gross recoverable resources (1) based on the report of independent reservoir evaluators GLJ Petroleum Consultants Ltd. (GLJ Report) dated March 1, 2010.
With regulatory approvals in place for the Commercial Demonstration project, Laricina will begin clearing of the plant site and SAGD Horizontal well pad area, commence detailed engineering, order long-lead equipment and prepare for construction in the first quarter of 2011. Drilling of observation and water source and disposal wells will begin this winter followed by the initial horizontal wells over the summer and fall of 2011. Plant construction will continue through to the first quarter of 2012 with first steam expected to occur in the second half of 2012.
The original 1,800 barrel-per-day SAGD pilot was approved by the ERCB and Alberta Environment in October 2009. The amendment, filed November 18, 2009, will increase bitumen production to 5,000 barrels per day and reflects several improvements over the original design. Notably, the Commercial Demonstration project incorporates solvent injection, diluent treating and water recycling. These modifications are expected to result in a lower steam to oil ratio, lower water usage, and lower carbon emissions per barrel of bitumen produced by thermal processes alone.
(1) Recoverable resources include the unrisked arithmetic sum of best estimate contingent and prospective resources and proved plus probable reserves as defined in the GLJ Report.
About Laricina Energy Ltd.
Laricina is a privately-held, Calgary-based company concentrating on capturing opportunities in the oil sands areas of western Canada. The Company is creating value through developing a diverse portfolio of oil sands assets using current and future innovations of in situ technology. Laricina has identified five core areas that present production potential in excess of 500,000 gross barrels of bitumen per day from a large concentrated resource base with approximately 4.6 billion barrels net recoverable bitumen. These assets range from the familiar oil sands in the McMurray Formation to less developed and less mature Grand Rapids and Grosmont and Winterburn carbonate plays, all of which offer significant resource 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 required under applicable securities legislation. The forward-looking statements are expressly qualified by these cautionary statements.