Petro-Canada, UTS Proceed with Front-End Engineering Design for $14 Billion Upgrader Project

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Researched by Industrial Info Resources (Sugar Land, Texas)--Petro-Canada and UTS Energy has selected engineering firms to complete front-end engineering design (FEED) for their proposed $14 billion project. The upgrader will be 40 kilometers northeast of Edmonton, Alberta. Technip Italy (Roma, Italy) will do engineering for the primary units. SNC-Lavalin (Montreal, Quebec) will do engineering for the mine site, pipeline, secondary units and south tank area. Washington Group International (Houston, Texas) will do engineering for off-site utilities to support the new upgrader. The FEED stage will complete the overall design for the project phase and will establish a cost estimate with appropriate risk assessment. SNC and UTS expect to receive regulatory approval to proceed by the second quarter of 2008.

The upgrader is expected to process 340,000 barrels per day of bitumen from the Fort Hills oil-sands mine and produce 280,000 barrels per day of light synthetic crude oil for refining into consumer products, such as gasoline and diesel, by either 2014 or 2015. The first phase will consist of a 165,000-barrel-per-day diluent-recovery unit; a 140,000-barrel-per-day four-drum delayed coker; a gas recovery unit; a 45,000-barrel-per-day naphtha hydrotreater; a two-train 110,000-barrel-per-day medium gas oil hydrotreater; a 155 million-standard-cubic-feet-per-day hydrogen plant; two 922-ton-per-day sulfur recovery units to include tail-gas-treating units; a 750-cubic-meter-per-hour amine-regeneration unit; and two sour-water strippers (190 cubic meters per hour for the coker and 170 cubic meters per hour for the hydrotreater). The engineering, procurement and construction phase of the project will begin after regulatory approval. The site preparation for Phase I is expected to begin in late 2008 with start-up planned for fall of 2011. The project will have a Phase II and possibly a Phase III, depending on economic evaluations.

Petro-Canada is one of Canada’s largest oil and gas companies, operating in both upstream and the downstream sectors in Canada and internationally. UTS Energy Corporation (Calgary, Alberta) is focused on growing and developing oil-sands assets. Petro-Canada has a 55% interest in the upgrader project, and UTS has a 30% interest. The remaining 15% interest is with Teck Cominco Limited, a diversified mining company based in Vancouver, British Columbia.

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