Syncrude emissions reduction plan to cost $1.6bn

Canadian Oil Sands Trust ("Canadian Oil Sands") CEO Marcel Coutu today announced an updated cost estimate for the Syncrude Emission Reduction ("SER") project of approximately $1.6 billion ($590 million net to Canadian Oil Sands based on our 36.74 per cent working interest). Canadian Oil Sands previously disclosed a cost estimate for the SER project of $772 million gross to Syncrude, but indicated that there was upward cost pressure on the project and an update to the cost estimate and timing would be provided once Syncrude had completed a full review of the project. The cost increase reflects a delay in the expected completion date and inflationary pressures. Construction of the project is approximately 14 per cent complete with about $412 million expended to date.

"Syncrude's voluntary effort to reduce sulphur dioxide emissions demonstrates our long-standing commitment to responsible environmental management and protecting the good air quality in the Wood Buffalo region," said Marcel Coutu, Canadian Oil Sands' President and Chief Executive Officer. "While the investment is significantly higher than we had originally anticipated, the SER project will also support the sustainable development of the Syncrude project and its future growth."
When combined with already completed Stage 3 improvements, the SER project is anticipated to reduce stack emissions of sulphur compounds by about 60 per cent from current approved levels. Emissions of particulate matter also should be significantly reduced. The project involves retrofitting sulphur scrubbing technology into the operation of Syncrude's original two cokers. The third coker that was constructed as part of the Stage 3 expansion already incorporated flue gas desulphurization technology that virtually eliminates sulphur dioxide emissions from this unit.
Located near Fort McMurray, Alberta, Syncrude Canada operates large oil-sands mines and an upgrading facility that produces a light, sweet crude oil on behalf of its joint venture owners, which include Canadian Oil Sands Limited, ConocoPhillips Oilsands Partnership II, Imperial Oil Resources, Mocal Energy Limited, Murphy Oil Company Ltd., Nexen Oil Sands Partnership, and Petro-Canada Oil and Gas.
Canadian Oil Sands provides a pure investment opportunity in the Syncrude Project through its 36.74 per cent working interest. The Trust is an open-ended investment trust managed by Canadian Oil Sands Limited and has approximately 481.5 million units outstanding, trading on the Toronto Stock Exchange under the symbol COS.UN.
Read Full Post...

Green Peace and Syncrude not getting along in the oil sands

Individuals representing GreenPeace were recently charged with trespassing (and nothing else) after infiltrating the Syncrude oil sands property and displaying a giant banner expressing their concern over the toxic nature of the projects tailing ponds.

Tailings, and the ponds that they collect in, are the toxic liquid by-products of the production process, and are what's left when the oil is 'washed' from the Alberta sand.

On their site the Peacers trumpet that "Braving toxic fumes and the same toxic tailings waste that earlier this year killed 500 ducks .... activists deployed a massive banner on the bank of the tailings pond while two other activists erected a banner on the top of another pipe which depicted a large skull and crossbones banner. The skull hung just above the pipe's opening, giving the illusion of toxic water gushing from the "mouth" of the skull."

Syncrude — a joint venture owned by Canadian Oil Sands Trust, Imperial Oil Ltd, Petro-Canada, ConocoPhillips, Nexen Inc., Nippon Oil Corp. unit Mocal Energy Ltd. and Murphy Oil Corp. — could not be reached for comment.

Industry has also launched a web site to show that it cares about the environment, you can see it here. The home page they've set up to counter the bad publicity has a quote by Marcel Coutu, Syncrude's chairman, that says:

"If you ask people for their views, you better be prepared to listen. I expect some tough criticisms of our industry, but we need to hear them directly from the public. If a criticism is unfair, we need to explain why. If it is fair, we need to act."

The bigger question is "What happens to the tailings and the collection ponds once the oil is gone?"


Read Full Post...

Marcel Coutu

Chairman - Syncrude Joint Venture

Marcel Coutu joined Canadian Oil Sands Limited, a wholly owned subsidiary of Canadian Oil Sands Trust, as President and Chief Executive Officer in September 2001. Under his leadership, Canadian Oil Sands internalized management and has grown to become the largest owner in the Syncrude Joint Venture. In addition to providing guidance and direction to the Trust, Mr. Coutu is Chairman of the Board of Syncrude and chairs the Syncrude Joint Venture CEO and Management Committees.

Mr. Coutu has 25 years of experience in the resource and energy sector, primarily focused in corporate finance. Prior to joining Canadian Oil Sands, Mr. Coutu was Chief Financial Officer of Gulf Canada until its sale to Conoco. Preceding that position, he was Senior Vice President International and Vice President Finance at TransCanada Pipelines where he helped finance their mainline expansion and international projects. Mr. Coutu also has worked many years in the upstream sector for companies that include Hudson's Bay Oil & Gas and Dome Petroleum, and has five years of experience in the investment banking business, mostly with Burns Fry Limited.

Mr. Coutu holds a H.B.Sc. in geology from the University of Waterloo (1976), an MBA from the University of Western Ontario (1980), and is a member of the Association of Professional Engineers, Geologists and Geophysicists (APEGGA). Mr. Coutu is a member of the Board of Directors of the United Way of Calgary and the Calgary Stampede Pension Committee. As well, he is on the Board of Governors of the Canadian Association of Petroleum Producers (CAPP). Originally from Welland, Ontario, Mr. Coutu now resides in Calgary with his wife and two children.

Rank:34

Age:55

Tenure:5 yrs., 9 mos.

Salary:$575 k

Bonus:$1.4 mil

Marcel Coutu was one CEO ahead of the curve when the federal government in April revealed its plan to cut 20% of emissions by 2020. In early March, he joined a climate-change task force of oil executives aiming to cut industry emissions. The Welland, Ont., native studied geology at the University of Waterloo and received his MBA from the University of Western Ontario in London in 1980. Apart from a five-year stint in investment banking, Coutu cemented his career in the oil and gas industry with senior positions at Gulf Canada Resources Ltd. and TransCanada Pipelines Ltd. Now CEO of Canadian Oil Sands Trust, Coutu also chairs Syncrude Canada Ltd., one of the company's major subsidiaries. Looking ahead, the father of two plans to boost production of the Syncrude Alberta oilsands project to 500,000 barrels a day in a decade.

Read Full Post...