Canadian oil-sands producers to raise production to fill Trans Mountain Pipeline

Robert Tuttle, Bloomberg August 04, 2023

(Bloomberg) – Canadian oil-sands producers, including Canadian Natural Resources Ltd. and Cenovus Energy Inc., are rushing to expand production to fill the biggest new pipeline project in more than a decade.

Canadian Natural will raise output from its Primrose site by 25,000 bpd in the current quarter and boost production at its Kirby oil-sands operation by 15,000 bpd in the fourth quarter, the company said Thursday. Cenovus plans to start up its Narrows Lake oil-sands site, an extension of its Christina Lake operation, in early 2025.

Alberta’s oil producers will have the ability to ship an extra 590,000 bbl of crude a day to the Pacific Coast next year  — the biggest jump in the province’s oil-export capacity in more than a decade — after an expansion of the Trans Mountain Pipeline begins service. The increase is a welcome turnabout for companies that have suffered for years from discounted prices because of a lack of pipeline space.

“This industry has a great habit of expanding to fill pipeline capacity,” Cenovus Chief Operating Officer Jonathan McKenzie said of Trans Mountain on a call this week. “That’ll be filled, I think, in relatively short order over the coming years.”

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