Groundbreaking in Turkmenistan for major synthetic gasoline plant; first full-scale Haldor Topsøe TIGAS facility
MAN shows TGX parallel diesel hybrid truck concept, previews CNG in TGM trucks at IAA; gearbox cooperation with Scania

Statoil postponing Corner oil sands project for minimum of 3 years; rising costs, limited pipeline access

Statoil will postpone the previously planned Corner field development at the Kai Kos Dehseh (KKD) oil sands project in Alberta, Canada, for a minimum of three years, due in part to rising labor and materials costs and market access issues including limited pipeline access. The decision has no implications for the Leismer project (Statoil’s first foray into the oil sands), also at the KKD, which is in production and has an operating capacity of 20,000 barrels per day.

Costs for labor and materials have continued to rise in recent years and are working against the economics of new projects. Market access issues also play a role—including limited pipeline access which weighs on prices for Alberta oil, squeezing margins and making it difficult for sustainable financial returns.

Despite the improvements made in the Corner business case, we have decided not to go any further with the project at this stage. The decision is in line with Statoil’s strategy to prioritize capital to the most competitive projects in its comprehensive global portfolio and is consistent with our stepwise approach to the oil sands.

—Statoil Canada country manager Ståle Tungesvik


Statoil entered Kai Kos Dehseh (KKD) through the acquisition of North American Oil Sands Corporation in 2007. (Kai Kos Dehseh—Red Willow River—is the Chipewyan Prairie Dene name for the river commonly known as the Christina River.)

The overburden thickness to the bitumen bearing resource within the Kai Kos Dehseh project area is approximately 400 meters, with bitumen-bearing reser- voir thicknesses ranging from 10 to 35 meters. This type of resource is commercially recoverable using SAGD (steam-assisted gravity drainage) and related technology—it is too deep for surface mining.

Visualization of bitumen resource (in green) at KKD. The resource is about 400 meters below the surface; the resource layer itself ranges up to 35 meters in thickness.Source: Statoil. Click to enlarge.

In 2011 the Thai company PTTEP farmed into a 40% interest in KKD for US$2.28 billion in cash. Earlier this year Statoil divided its oil sands leases with PTTEP, in which Statoil would have 100% ownership of the Leismer and Corner projects while PTTEP took 100% ownership of the Thornbury, Hangingstone and South Leismer areas.

The oil sands leases are located approximately 120 kilometers south of Fort McMurray in the Athabasca region of north east Alberta. Leismer began production in January 2011, and has been approved by the Alberta Energy Resources Conservation Board (ERCB) for further expansion to 40,000 bpd.

Corner was also a proposed 40,000 bpd facility.



The oïl sands leases are valid for 5 years. If not developed thay can be recovered and offered to the highest bidders again.

The comments to this entry are closed.