Oil producers are set to be squeezed as a total of 14 new oilsands projects are scheduled to start next year while crude prices continue to fall
” […] “There is a lot of crude coming on next year,” Juan Osuna, IHS Energy Inc.’s senior director for North American oil said in a phone interview Dec. 12. Producers “aren’t going to be happy, they will make a greater effort to cut costs, but they have been prepared for this.”
Western Canadian Select fell to US$39.38 a barrel Monday, the lowest since April 2009, according to data compiled by Bloomberg. The grade, which has higher sulfur content than U.S. benchmark West Texas Intermediate, sold at an average US$18.78 a- barrel discount in the past year, according to data compiled by Bloomberg.
Oilsands projects slated to start next year include ConocoPhillips and Total SA’s joint 118,000 barrel a day Surmont project and the 40,000-barrel-a-day expansion of Cenovus Energy Inc.’s Foster Creek project […]
Husky Energy Inc. said last week it began steam operations on its Sunrise crude project with the first phase set to begin pumping oil by early next year.
While oilsands producers may curtail future development, most existing operations won’t be shut and ones under construction will go ahead because of the investments involved and potential harm to future output, Osuna said.
Cenovus said Dec. 11 production would rise 9 per cent to 129,000 barrels a day from its Foster Creek and Christina Lake projects next year even as it lowered its spending plan by about 15 per cent.
Canada’s oilsands output is projected to rise to 3.7 million barrels a day by 2020 from 1.98 million last year, according to a report last month by the Canadian Energy Research Institute.
Brent oil traded near US$61 a barrel Monday as the United Arab Emirates said the Organization of Petroleum Exporting Countries will resist output cuts even if prices slump as low as US$40. […]”<