Deer Creek Energy Limited has an 84% interest in the leases of the Joslyn Project in the Athabasca region of the Canadian Province of Alberta. The Joslyn Project will be a multi-phase development with estimated cumulative production of around 2 billion barrels of bitumen over 30 years. The majority of the resource will be recovered using open pit mining techniques. In-situ steam-assisted gravity drainage (SAGD) technology will also be used.
An application will be submitted to the Alberta authorities (Alberta Energy and Utilities Board – AEUB) in early 2006 for the first phases of the mine and related extraction facilities. The mining operations will be a large-scale development. Production from the mine is scheduled to begin in 2010 and, following several phases, reach a plateau of 200,000 barrels per day of bitumen.
The first two phases of SAGD development have been approved by the AEUB. Currently in its start-up stage, the pilot is targeted to become commercial in 2006, with a production of about 10,000 barrels per day. Further phases are under study to take production to a significantly higher level.
The Joslyn Project will include downstream operations to further process the bitumen to improve the added-value of the products. Downstream operations are likely to include upgrading in Alberta. It is expected that downstream synergies could be drawn from Total's equity production of the Joslyn Project and other oil sands leases.
This acquisition is in line with Total's strategy of expanding its heavy oil operations in the Athabasca region. The Group already owns a 50% interest in the Surmont SAGD project, 125 kilometers south of the Joslyn Project.
Total is already a major player in extracting and converting heavy oil thanks to its 47% participation in the Sincor project, in Venezuela, one of the world's largest developments of its type, which produces more than 200,000 barrels per day.
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