Thermal Oil
Our Thermal Oil Division consists of two operating oil sands SAGD projects and a large resource base of exploration areas in the Athabasca region of northeastern Alberta. These projects provide Athabasca with a material low decline production base that generates significant free cash flow for the business.
The thermal assets use steam assisted gravity drainage (SAGD) which is an enhanced oil recovery technology for producing bitumen. In the SAGD process, two parallel wells are drilled into the reservoir. The wells are typically placed approximately 5 m apart and the upper well injects steam into the formation to warm up the bitumen and the lower well produces the warmed bitumen and condensed steam. The mixture is produced back to the surface facility where the oil and water are separated, and the water is recycled back into the process. The SAGD process recycles the majority of the water that is used for steam generation (~80-90%). The resource is developed through pad drilling to reduce land disturbance. There are no mines, tailings ponds, or large-scale excavation of the land for the SAGD process.
Source: CAPP
LEISMER
- Cornerstone asset with current production in excess of 20,000 bbl/d
- Top-quality oil sands project
- 8 producing pads (45 SAGD well pairs, 15 infill wells)
- ~705 MMbbl Proved plus Probable (2P) reserves and ~90 year 2P reserve life
- Regulatory approvals in place for up to 40,000 bbl/d
- Organic growth to ~24,000 bbl/d within corporate capital guidance
- Phased debottleneck opportunities to expand production to 40,000 bbl/d at competitive capital efficiencies
- Low sustaining capital requirements and significant free cash flow generation
- Non-condensable gas (NCG) co-injection supports reduced energy intensity
- Low Crown royalty advantage as the project is expected to remain in pre-payout phase until 2027/28
- Partnered with Entropy to develop and implement a carbon capture and storage project with the aspiration of producing a net zero barrel
HANGINGSTONE
- Current production in excess of 9,000 bbl/d
- 5 producing pads (25 well pairs)
- ~172 MMbbl of Proved plus Probable (2P) reserves and ~50 year 2P reserve life
- Regulatory approvals in place for up to 12,000 bbl/d
- Low sustaining capital requirements and significant free cash flow generation
- Generates revenue and reduces operating costs by the processing third-party volumes at our truck-in terminal
- Low Crown royalty advantage as the project is expected to remain in pre-payout phase until 2030+
- Non-condensable gas (NCG) co-injection supports reduced energy intensity
CORNER
- Top tier, fully delineated oil sands lease
- ~770 MMbl resource (2P reserves + best estimate contingent resource)
- Regulatory approval for 40,000 bbl/d project
- Excellent reservoir quality, similar to adjacent Leismer lease
- Established regional infrastructure footprint
DOVER WEST
- Large contiguous land base with exposure to significant bitumen resource
- ~149,000 acres of oil sands leases
- 2,223MMbbl of bitumen unrisked Best Estimate Contingent Resources (445MMbbl Risked)
* Dover West recoverable resource is based on McDaniel’s 2C unrisked best estimate 2.2 billion barrels + management's estimate of recoverable volumes associated with the Leduc Carbonates of ~3 billion barrels, which are not booked as reserves or contingent resource by McDaniel
Light Oil
Within our Light Oil Division, we produce light oil and liquids-rich natural gas from unconventional reservoirs. Our focus is targeting high margin and quick payout opportunities. We hold a significant interest in the Duvernay at Greater Kaybob.
Our Light Oil Division has a consistent track record of top decile netbacks relative to Canadian peers. We own and operate strategic regional infrastructure which provides direct access to end markets.
DUVERNAY AT GREATER KAYBOB
- 30% WI in de-risked resource with spending governed by a strong JV agreement
- ~155,000 gross perspective acres
- ~500 Duvernay locations
- Scalable asset, minimal near-term land expires and flexible development options
- Infrastructure owned and operated
