Statoil Canada’s new CEO on keeping the oil sands competitive

'One thing is to optimize what we have,' Ståle Tungesvik says

January 11, 2013

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Statoil Canada Ltd. CEO Ståle Tungesvik
Photograph Bookstrucker

Ståle Tungesvik is enjoying life in Calgary since settling in as the new president of Statoil ASA’s Canadian unit. “It’s been wonderful,” he says. Less peachy, perhaps, is the level of scrutiny faced by companies whose prominent shareholder also happens to govern a sovereign state. No matter, says Tungesvik. He takes the helm at Statoil Canada Ltd. just in time to see an oil sands demonstration plant called Leismer grow up and another exploration campaign set to begin on Canada’s East Coast.

Alberta Oil: State-owned companies are perceived as inefficient and in some cases have provoked a visceral reaction from legislators in Ottawa. What makes Statoil different from, say, Cnooc Ltd.?
Ståle Tungesvik:
We don’t look upon ourselves as state-owned. We are a listed company, run like a private company, but we do have a 67 per cent shareholder called the Norwegian state. They don’t intervene very much in what we do. The business is run for business purposes. They have a place on the board of directors and that’s more or less it.

AO: You previously led Statoil’s renewable energy division, where you helped develop one of the largest offshore wind farms in the world. Are there parallels between that experience and your new role in the oil sands?
The profile [of offshore wind] is about the same as the oil sands. It’s a huge investment in the beginning, so you have to be careful with costs. You have to really find out how to do this in an efficient way. Then again, the wind industry was supported with federal funding. We don’t have that here. But you need to bring in new elements to drive the costs down and be more efficient.

AO: Statoil hopes to produce 220,000 barrels of oil sands per day by 2025. Are you concerned about market access given ongoing delays in building new pipelines?
I think that’s on the radar all the time. Looking at the oil sands and the huge resources, if they are locked up, it’s of course [less valuable] for authorities and for the companies. So we think it’s important for us to reach high-value markets. Right now we are seeing that there is a price reduction in Edmonton compared to if you go to the coast – West Coast, East Coast … either way. And we see there is some value uplift if you can bring your products there.

AO: Can railcars help?
We’ve done that for the Bakken area [in North Dakota]. We’re still looking at [whether] that could be a solution for oil sands.

AO: The U.S. oil boom hasn’t been kind to Alberta producers. How can the oil sands stay competitive?
One thing is to optimize what we have. How can we reduce costs and be more efficient? It’s easy to point at other people and say they should make it easier for us, but you have to look into the mirror and have a good chat with the man who’s there and ask: what are you going to do differently?

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3 Responses to “Statoil Canada’s new CEO on keeping the oil sands competitive”

  1. William Smallwood says:

    Limestone (Calcium Carbonate) and Potash Rock (Potassium Carbonate) are two common rocks that can be environmentally chemically converted into petroleum! There are 3 Oxygen electrolyzed into freedom after the carbonate is electrolyzed! The carbon dioxide still may undergo photosynthesis into fresh oxygen! Again I can show you how to make oil from Limestone and Potash Rock if you’re interested!

    I’ll explain the Chemistry, but not the Physics!
    1) I’m in no way employed by an oil company, or pipeline company, or even an employer!
    2) My brother worked as a rough-neck that explored the northern prairie provinces for the Fort McMurray refiners when he died from a bolt in the rig, flying free and hitting him in his temple!
    3) I now realize that Limestone, Calcium Carbonate, and Potash Rock, Potassium Carbonate, contain 3 Oxygen atoms for every single Methane molecule! Initially the Carbonate rocks must be dissolved into a bath of Hydro-Chloric acid! The Methane are then electrolyzed into synthetic Octane petroleum, but that’s Physics!
    4) I can get this great reaction to happen, 100% stopping at making Octane gasoline which burns less carbon! So 16 Limestone molecules can yield 2 Octane petroleum molecules + 3 x 2 x 8 = 48 Oxygen atoms + 16 Calcium atoms! Which burn into 16 Carbon Dioxide molecules + a further 16 Oxygen atoms etc.
    5) I’ll remember that in Canada ‘Better is always possible’!

  2. Is Limestone the next Bitumen?

    Chemically create pure synthetic Octane GASOLINE from electricity and Hydro Chloric acid with either Calcium CARBONate (limestone) or Potassium CARBONate (potash rock)! Petroleum had to drilled and if lucky pumped up to the surface! But tomorrow it can be electrolyzed CARBONate rock after reacting with Hydro-Chloric acid to produce pure synthetic Octane GASOLINE!

  3. William Roy Whiteway Smallwood says:

    Why not make Octane gasoline from limestone. It’s easier to reach at foot level than thousands of fett under the ground! Don’t go bankrupt, join the crowd and take the lead of 1) chemically converting limestone into vapour CO2, 2) electrically separating the CO2 into Oxygen waste and Methane gas, 3) electrolyze into Ethane gas 4) electrolyze into Butane gas, 5) Electrolyze into Octane gas, 6) Condense into Octane gasoline!