February 23, 2010

CENOVUS

Cenovus will use its own construction management team for upcoming work at its Christina Lake, Alta. oilsands project.

Cenovus accelerates construction of Christina Lake oilsands project

RICHARD GILBERT

staff writer

An oilsands company is leaving nothing to chance and is taking charge of building its own facilities. Cenovus has its own construction management team, which helps accelerate construction on the Christina Lake, Alta. oilsands project.

“We have found that this is the most efficient way to undertake construction because the work is done in phases,” said Cenovus spokesperson Rhona DelFrari.

“Anything we learn from the previous phase is implemented into the next phase of construction.”

Christina Lake is located about 120 kilometres south of Fort McMurray, in northeast Alberta.

The project, which began in 2000, is growing in phases with the next 40,000 barrel per day expansion, phase C, expected to be completed in 2011.

“Most of the construction work is at the actual plant,” explained DelFrari.

“As we drill and bring on more wells, there is a need to expand the plant facilities.”

The oil at Christina Lake is located about 375 metres below the surface and requires enhanced oil recovery technology to access and produce it.

The primary technology used for this project injects steam into the reservoir to soften the oil so it can be pumped to the surface

Construction on phase C involves the expansion of overall plant operations to process this oil by adding new boilers for steam and facilities for separating water.

This includes the construction of pipelines which connect the wells with the plant.

Enbridge Inc. has entered into an agreement with FCCL Partnership to provide additional pipeline and terminal facilities to support expansion of the Christina Lake enhanced oil project.

The additional facilities will include a new terminal, called Sunday Creek, near Enbridge Athabasca’s Christina Lake station, with two new bitumen blend tanks and all necessary associated piping, manifolds and pumps.

The new facilities also include the construction of a 26-km, 762-mm (30-inch) diameter, pipeline from Sunday Creek Terminal to Kirby Lake Terminal, running adjacent to Enbridge’s existing pipeline.

The additional facilities, which will cost $250 million, will accommodate the current and future expansions.

“The expansion of the Christina Lake enhanced oil project, following our securement of the Imperial Oil/ExxonMobil Kearl contract last year, provides further confirmation of the sustainable growth in oilsands production and regional pipeline infrastructure, which we expect over the next decade,” said Patrick D. Daniel, president and CEO of Enbridge.

Construction of phase D, another 40,000 barrel per day expansion, is expected to begin in 2010 with production to start in 2013.

A regulatory application for three more phases of expansion at Christina Lake was filed in the fourth quarter of 2009.

The current goal is to reach production capacity of about 218,000 bbls/d by 2017.

Cenovus is an integrated oil company.

It was formed in November, 2009 from the split of EnCana Corporation into two independent publicly traded energy companies.

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