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Husky thermal projects producing 20 per cent better than design capacity

Calgary – Husky Energy saw strong performance from its Lloydminster thermal project in the first quarter of 2017, according to their quarterly report released May 5.
Husky Rush Lake Thermal
Several of Husky’s thermal projects are performing better than expected. This is their Rush Lake thermal project, as seen in February.

Calgary– Husky Energy saw strong performance from its Lloydminster thermal project in the first quarter of 2017, according to their quarterly report released May 5.

The company said strong performance from the Edam East, Vawn and Edam West Lloyd thermal projects contributed to overall average net thermal bitumen production of 121,000 bpd, including the Tucker Thermal Project and Sunrise. Overall thermal operating costs were $11.83 per barrel in the quarter.

The Edam East, Vawn and Edam West developments, which came on production in 2016, are producing at 20 per cent above design capacity, averaging 30,000 bpd. Average operating costs for the three projects were $8.23 per barrel in the quarter.

Construction continued to advance at the 10,000 bpd Rush Lake 2 Lloyd thermal project, with first oil expected in the first half of 2019. Open houses were held for the sanctioned 10,000 bpdy Lloyd thermal projects at Dee Valley, Spruce Lake North and Spruce Lake Central, advancing the projects toward regulatory approval.

At the Tucker Thermal Project, first production from a new eight-well pad began in the quarter and drilling continued on an additional 15-well pad. Production from Tucker is anticipated to ramp up through 2017 and 2018 towards 30,000 bpd.

Gross production at Sunrise averaged 35,800 bpd (17,900 bpd net to Husky) in the quarter, up about six per cent from the fourth quarter. Current production has reached 40,000 bpd (20,000 bpd net to Husky), with average per well pair production of about 730 bpd. Work is progressing to tie in 14 new well pairs, and steaming is expected to commence later this year.

To date, the company has signed purchase and sales agreements for the sale of about 3,300 boepd of production in Western Canada for $88 million in gross proceeds.

The Western Canada business is moving ahead with increased capital efficiency, Husky said. The repositioned portfolio is now more than 70 per cent gas-weighted, providing a natural hedge for the company’s energy requirements at its thermal projects and refineries.