Blue Sky Refining Plans $2.5 Billion Plant in Alberta

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Researched by Industrial Info Resources (Sugar Land, Texas)--Blue Sky Refining Incorporated (Calgary, Alberta) plans to construct a 200,000-barrel-per-day refinery in McLennan, Alberta. The refinery is expected to be constructed in four phases of 50,000 barrels per day to produce diesel and gasoline fuels to meet demand in the Peace River area. The first phase is expected to begin construction late 2009 and start up is planned for 2012. The other phases are planned to start-up between 2014 and 2019 depending on market demand.

The plant will be the region's first bitumen upgrader and refining facility. The refinery will produce finished products, ultra-low-sulfur diesel and two grades of finished gasoline. The company has chosen WorleyParsons (Calgary, Alberta) to perform the front-end engineering design for the proposed refinery. In early 2008, Blue Sky will choose an engineering and construction company to perform engineering, procurement and construction services.

Blue Sky was established by two individuals who have spent majority of their careers operating, designing, or selling oil-sands-related technology. Peace River Oil, a major stockholder of the company originally planned a 100,000-barrel-per-day facility and decided to double capacity in November 2006 when it secured oil-sands rights to 9,000 acres of land. The land is 50 kilometers northwest of the company's project site in the Peace River area. The proposed refinery will be in one of the three oil reserves in Alberta with an estimated initial volume of 1.6 trillion barrels of crude bitumen.

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