Sunshine Oilsands Enters the Alberta Oil Sands Patch with More Than 1 Million Acres of Holdings

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Researched by Industrial Info Resources (Sugar Land, Texas)--For the most part, Sunshine Oilsands Limited (Calgary, Alberta) has flown under the radar, acquiring slightly more than 1 million acres of land holdings in the Alberta oil sands patch. These land holdings are some of the largest of all the oil sands players in the Athabasca region. The diverse project portfolio consists of prospective conventional heavy oil targets, cretaceous sandstones applicable to thermal recovery methods, as well as carbonate bitumen resources. Sunshine Oilsands is currently moving forward with a 500-barrel-per-day (BBL/d) pilot plant in the Harper carbonate area to test extraction technology that has proven effective at a similar geological formation in a carbonate resource in Egypt. If the pilot plant proves the technology, then the Harper carbonate resource could provide up to 270,000 BBL/d of bitumen over a 25-plus year life.

Other projects that Sunshine Oilsands is evaluating are the Portage heavy oil target with a potential for 65,000 BBL/d and the conventional heavy oil Muskwa prospect, with a production rate of approximately 35,000 BBL/d. Sunshine Oilsands also has four oil sands targets that are exploitable utilizing the proven steam assisted gravity drainage (SAGD) technology. These prospects include Goffer with 20,000-BBL/d potential; West Ellis and Thickwood, each with 65,000- to 80,000-BBL/d potentials; and the Legend Lake prospect, with a potential production of 50,000 BBL/d of bitumen.c The primary interest of Sunshine Oilsands is the production of primary heavy oil and bitumen, rather than the upgrading of these products to synthetic crude oil. The Legend Lake, West Ellis, and Thickwood prospects have an average net play of 12 to 22 meters thick, with an average porosity of 32% to 33% and a bitumen saturation of between 73% and 78%. The depths of these reservoirs range between 200 and 430 meters, and all are considered deltaic sands.

The development timeline for these projects--which largely depends on financing--ranges from completions of the first 10,000-BBL/d phases of West Ellis and Thickwood in 2012 and 2013, respectively, to completions of the final phases of these and other prospects as late as 2025. Sunshine does expect to have the Harper pilot plant online sometime in the first half of 2010. Sunshine Oilsands has awarded Bower Damberger Rolseth Engineering Limited (Calgary, Alberta) the engineering contract for the pilot plant.

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