(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

Okanagan Water Board opens floodgates with call for grant applications

Water Conservation and Quality Improvement program open from Armstrong to Osoyoos

Vernon Vipers forward named BCHL POW

Matt Kowalski named Player of Week after nine points in three games, all Vernon victories

Lumby residents don’t want big cannabis facilities

RDNO holds public hearing about potential bylaw changes affecting Electoral Area D

Coldstream surf shop welcomes winter with paddle

Winter Chill event Saturday, Dec. 21, on Kal Lake is ‘food’-raiser for food bank

James and Jamesy return to Vernon for more Christmas tea

Their Dec. 19 show explores friendship, the joy of giving and a celebration of the imagination

VIDEO: Octopus, bald eagle battle after bird ‘bites off more than it can chew’ in B.C. waters

B.C. crew films fight between the two feisty animals in Quatsino off north Vancouver Island

Raptors fans show Kawhi the love in his return to Toronto

Leonard receives championship ring, leads new club to win

Process to identify those killed in Gabriola plane crash could take days

Canadian flight museum suggests Alex Bahlsen of Mill Bay died in Tuesday’s crash

RCMP uncover meth in arrest of Sicamous woman linked to alleged pellet gun shooting

Police say methamphetamine and other drugs found in car driven by suspect

Vandalism closes public washrooms in Penticton’s Okanagan Lake Park indefinitely

A post by the city’s Facebook said the damage is ‘quite extensive’

Disturbing find: Shuswap family seeking Christmas tree locates several animal carcasses

Black bear, a coyote and five deer found dumped in gravel pit west of Salmon Arm

Pawsative Pups: Help your dog love their crate

Lisa Davies is a new columnist for Black Press who writes about dog training

Spark Joy: The art of giving and receiving

Barb and Wendy at Simply Spark Joy help you to create a clutter free home on the Black Press Media

‘Honest mistake:’ RCMP says B.C. cannabis shop can keep image of infamous Mountie

Sam Steele wearing military, not RCMP uniform in image depicted in Jimmy’s Cannabis window

Most Read