MOU signed with CPECC for West Ells Phase II Expansion project
Monday, Mar 20, 2017
On March 20, 2017 (Hong Kong Time) / March 19, 2017 (Calgary Time), the
Corporation and China Petroleum Engineering & Construction
Corporation (CPECC) have signed a Memorandum of Understanding (“MOU”) in
relation to the West Ells Phase II (“Phase II”) project expansion.
Ells Phase I is currently in production with positive reservoir
performance and the production volume is continuously increasing. The
designed production capacity of Phase I is 5,000 barrels per day.
Ells Phase II is an expansion of the Phase I project with an additional
production capacity of 5,000 barrels per day. As at the date of this
announcement, all 8 wells have already been drilled. Additional works
required for the project expansion include reviewing and refining of
some of the designs, completion works for the wells, and surface
facility construction. The total capital required for completion of the
Phase II is expected to be approximately USD50m as it will share most of
the surface facilities with Phase I. Upon completion of Phase II, the
total production capacity of West Ells will be 10,000 barrels per day.
average production costs per barrel is expected to be significantly
reduced after the Phase II expansion as fixed costs account for a
significant portion of the production cost and can now be shared with
the Phase II project.
CPECC and the Corporation will further
explore and discuss the work of this expansion project. CPECC intends to
work as the contractor and undertakes the engineering, procurement,
construction and operation maintenance work.
The Corporation will provide further updates when the formal agreement is signed.
ABOUT SUNSHINE OILSANDS LTD.
Corporation is a Calgary based public corporation listed on the Hong
Kong Stock Exchange since March 1, 2012. The Corporation is focused on
the development of its significant holdings of oil sands leases in the
Athabasca oil sands region of Alberta, Canada. The Corporation owns
interests in approximately one million acres of oil sands and petroleum
and natural gas leases in the Athabasca region. The Corporation is
currently focused on executing milestone undertakings in the West Ells
project area. West Ells has an initial production target rate of 5,000
barrels per day.
For more information, please visit: http://www.sunshineoilsands.com
information on projects, please visit ProjectsOGP