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UK supermajor BP and Canadian player Husky Energy will go ahead with the C$10 billion (US$8.1 billion) Sunrise oil sands project, with BP's chief executive saying today a final decision on the plan is expected next year. BP head Tony Hayward said the partners should proceed with the oil sands production and refining joint-venture, even as most other new projects in the high-cost region are deferred, delayed or canceled because of low oil prices. "The project's currently in the pre-engineering stage. That will continue to be worked hard in 2009 to come up with the best project both in terms of its design and in terms of its contracting strategy," Hayward said. "I think hopefully we could look at a decision in 2010." British oil supermajor BP and Husky, Canada's second-largest oil exploration and refining company, are still hammering out design details for Sunrise, according to a Reuters report. BP and Husky each have a 50% stake in the 9 billion barrel Sunrise project. The first 60,000-barrel-a-day phase has been targeted for start-up in 2012. The companies have also agreed to spend about $2.5 billion converting a Toledo, Ohio, refinery so it can run the oil-sands derived crude. The fate of the Sunrise project was thrown into question this month when Husky's vice-president of oil sands resigned with a sanction decision looming. Industry-wide, more than C$90 billion worth of oil sands projects have been put on hold or canceled in the past five months as oil prices tumbled and credit markets tightened. That has led a small group of oil sands developers to say they welcomed the slowdown in activity because it will bring a drop in overheated labor and materials costs. Indeed, Hayward said the joint-venture would be able to take "advantage of what I believe will be strong deflationary pressures." Source: Upstream
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