ConocoPhillips Approves Surmont Oilsands Project

The board of directors of ConocoPhillips has approved the Surmont oilsands project in Alberta, Canada. The $1.1 billion project is expected to achieve production of more than 100,000 barrels per day (BPD) of bitumen by 2012.

Construction of the facilities, 60 kilometers southeast of Fort McMurray, Alberta, Canada, will start early in 2004. Initial production will commence in 2006, increasing to more than 100,000 BPD by 2012.

"This is an important step in the development of Surmont, which is a significant addition to our portfolio of legacy projects," said Bill Berry, executive vice president of upstream. "This project draws upon the strengths of integration with our downstream coking capacity, which will enable significant economic advantages."

The Surmont project uses a method called Steam Assisted Gravity Drainage that involves the injection of steam deep into the oil sands, effectively melting the heavy bitumen, which then is recovered and pumped to the surface for further processing.

Henry Sykes, president of ConocoPhillips Canada, said, "The progress on this project thus far is due to the hard work and ingenuity of our people and the contributions of our partners, Total and Devon, as well as the constructive relationships that we have built with the local aboriginal communities and others in the region. We look forward to a project that minimizes environmental impacts while creating employment and other benefits, particularly for nearby communities."

ConocoPhillips Canada, a wholly owned subsidiary of ConocoPhillips, is operator of Surmont and has a 43.5 percent stake in the project and lands, together with partners Total (43.5 percent) and Devon (13 percent).