Imperial has made a final investment decision to develop its Aspen project, located about 45 kilometres northeast of Fort McMurray, Alberta. The project, which is expected to produce about 75,000 barrels of bitumen per day, will include the first major commercial application of next-generation oil sands recovery technology designed to lower greenhouse gas emissions intensity and water use, while improving development economics.
Through the application of advanced solvent-assisted, steam-assisted gravity drainage technology at Aspen, Imperial is building on its recently announced commitment to reduce the greenhouse gas emission intensity of its operated oil sands facilities. The new technology is estimated to reduce greenhouse gas emissions intensity and water use intensity by up to 25 percent, compared with traditional steam-assisted technology. Imperial anticipates that Aspen's emissions intensity will be one of the lowest among in situ oil sands operations across the industry.
"We do not take investment decisions lightly, particularly in these challenging times," said Rich Kruger, Imperial chairman, president and chief executive officer. "This is the right technology at the right time to make a competitive investment. We have made the decision to proceed now because we believe this advanced technology will further the evolution of Imperial's oil sands business."
Imperial consulted with seven local Indigenous communities during the regulatory application process to reach collaborative and unique relationship agreements that provide mutual benefits and support long term sustainable development of these communities. The agreements establish a framework to ensure information-sharing and community engagement with regard to environmental stewardship. They also provide economic benefits, workforce opportunities, strategic business development and potential business contracts that support project construction and operation.
With a cost estimate of CA$2.6 billion, the Aspen project is anticipated to create about 700 jobs during peak construction and more than 200 jobs during operations. Based on preliminary estimates and current tax and royalty rates, more than CA$4 billion in direct federal and provincial tax revenues are expected to be generated over the 30-year life of the project, as well as deliver more than CA$10 billion in royalty revenues to the Alberta government.
Construction will begin in the fourth quarter of 2018 with first production expected in 2022. There is potential for further development of up to another 75,000 barrels per day of bitumen production with timing dependent on a number of factors, including foundational project performance and overall business and market conditions.