Gallery: Shell Canada Ltd.’s Albian Sands project
A visual tour of a northern mining operation
Shell Canada Ltd. is keeping pace with expansion plans of other oil sands mine operators by adding 85,000 barrels per day (bpd) of oil capacity to its Albian Sands project. The subsidiary of international oil giant Royal Dutch Shell PLC has also applied for regulatory approval of a further expansion of 100,000 bpd.
Albian Sands consists of two mining operations that currently produce 255,000 bpd. Shell put its stake down in the oil sands in 1999, and first oil was produced from its Muskeg River Mine in 2002. Five years later, the Albian Aerodrome and Albian Village were opened adjacent to the mine site, 75 kilometers north of Fort McMurray, to support expansion of this operation. First oil was produced from the nearby Jackpine Mine in 2010.
The bitumen is upgraded at Shell’s Scotford facility near Fort Saskatchewan, Alberta. The oil sands upgrader could have the capacity to process 400,000 bpd if a series of expansions are conducted, the company says.
Shell owns 60 per cent of the Athabasca Oil Sands project, which includes the two mines, the Scotford upgrader and the Quest carbon capture and storage project. Chevron Canada Ltd. and Marathon Oil Canada Corp. each have a 20 per cent stake in the project.
The ownership structure insulates Shell against commodity price swings and allows the company to spread investment throughout its integrated business, says Stephanie Sterling, vice-president of business and joint venture management with Shell Canada.
“These are risky ventures,” she says. “These are large operations and large construction projects; and the crude prices we have today might not be the crude prices we have in five years when we start producing oil, so it’s about being able to spread some of that business risk.”