(The Canadian Press)

Chinese companies commit to Canadian oilsands despite setbacks, poor operating results

European and U.S. companies have cut back

While some European and U.S. companies cut their exposure to the Canadian oilsands, China’s Big Three oil giants — CNOOC, PetroChina and Sinopec — seem content to let their bets ride even if the results haven’t been spectacular.

In 2018, PetroChina produced an average of just 7,300 barrels per day of bitumen from its MacKay River thermal oilsands project, although it was designed to produce 35,000 bpd. In June, its output was about 8,700 bpd.

The Beijing-based company paid $1.9 billion in 2009 for 60 per cent interests in the proposed MacKay River and Dover oilsands projects being developed by Athabasca Oil Sands Corp. (now just Athabasca Oil Corp.), then bought out the rest of MacKay for $680 million in 2012 and Dover for $1.2 billion in 2014.

“MacKay River is located in an area with complex geology, which creates challenges to heat up the reservoir to get the bitumen flowing,” said spokesman Davis Sheremata in an emailed statement.

The company is drilling new wells and experimenting with various technologies to boost output, he said, adding a go-ahead for Dover has been put on hold until MacKay proves itself.

Still, “PetroChina Canada is committed to Canada for the long-term, having maintained its investments through economically challenging times.”

CNOOC produced about 71,000 bpd from the oilsands in 2018, little changed from 66,800 bpd in 2014, shortly after it spent $15.1 billion to buy Calgary’s Nexen Energy and its diverse portfolio of domestic and international assets.

“Our oilsands assets are an important part of our North American portfolio and we remain committed to our Canadian operations,” CNOOC spokesman Kyle Glennie wrote in a brief email.

Meanwhile, Sinopec paid $4.65 billion to buy a nine per cent stake in the Syncrude oilsands mining consortium from ConocoPhillips in 2010 and its resulting production has been steady since, registering just over 27,000 bpd in 2018.

The Chinese energy majors employ “patient capital” and it seems unlikely they will leave the oilsands anytime soon, said Jia Wang, deputy director of the China Institute at the University of Alberta.

“The assets they bought may not be the most profitable or may require more capital intensive development. … (but) these are large Chinese companies, they’re not likely to become bankrupt,” she said.

“They have been through thick and thin, and different cycles of boom and bust. These (oilsands) operations in the grand scheme of these massive companies are not the largest chunk of their business so they can afford to have a presence here without incurring too much loss.”

READ MORE: ‘Making this up:’ Study says oilsands assessments marred by weak science

Dan Healing, The Canadian Press


Like us on Facebook and follow us on Twitter.

Just Posted

Caps win via OT and shutout

Howard’s 27 stops help Cowichan beat Salmon Arm

Go green this holiday season with light recycling and energy saving in Cowichan

It’s true, Bings Creek, Meade Creek and Peerless Road facilities all accept the strands.

N. Cowichan rejects Motorsport rezoning for a second time

The surprise of the night came when Siebring switched to the no side

Dashcams to be installed on South Cowichan school buses

“disturbing tend” of “motorists disregarding school bus stop signs and putting our learners at risk”

Seymour re-elected chief of Cowichan Tribes

Council’s 12 seats also decided

B.C. woman charged in connection to stolen vehicle smash-up in Kamloops

Kersten Ina Peters was arrested in the Fraser Valley on Friday, Dec. 6

Truck with body inside found at bottom of lake near Kootenay ferry

Investigators believe no foul play is expected but are unsure how the vehicle ended up in the Arrow Lakes

VIDEO: Calgary man narrowly escapes from avalanche while running at Lake Louise

Bryon Howard caught the entire wild experience on camera

PHOTOS: Competitive Christmas light display takes sarcastic turn in Princeton

Heather King of Princeton took a creative and stress-free approach to her holiday display this year

RCMP asks Kootenay cannabis shop to remove image of famous Mountie from storefront

Owner happy to comply with RCMP, but wants more information first

BC Ferries adds 170 extra sailings for the holidays

6 a.m. and 10 p.m. sailings added for busy season

Anti-money laundering agency warns casinos to watch gamers playing with bank drafts

Financial Transactions and Reports Analysis Centre of Canada, known as Fintrac, issues operational alert

Strata rental bans escape B.C. speculation tax through 2021, Carole James says

Vacant home tax won’t apply to cabins accessible only by water

Most Read