Statoil Looking for Canadian Oil Sands Deal

LONDON Sep 28, 2006 (Dow Jones Newswires)

Norwegian energy firm Statoil ASA (STO) is looking to strike a deal worth more than $1 billion in Alberta's oil sands, according to a report in the Globe and Mail.

The company is looking to build an integrated oil sands project in Alberta, complete with an upgrader, and is seeking to acquire both a project and at least one partner, said Peder Sortland, head of Statoil's non-conventional oil unit.

Statoil is focusing its search on an in-situ project, in which steam is injected into a heavy oil reservoir and the bitumen within pumped to the surface, rather than on a conventional oil sands mining operation, he added.

While striking an initial deal could cost more than $1 billion, building a project and an upgrader, which processes Alberta's heavy crude so it can be received by more refineries, could eventually cost upward of $10 billion, Sortland said.

Copyright (c) 2006 Dow Jones & Company, Inc.

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