Canada Opens First Oilsands Site Greenlit Since 2013 – IPC Produced Oil From the Initial Phase of its US$855 Million Blackrod Site

International Petroleum Corp. produced oil from the initial phase of its US$855 million Blackrod site, which was Canada’s first new Alberta oilsands project greenlit in more than a decade when it moved ahead in 2023.

Oil production started on May 31 and the site will ramp up to 30,000 barrels a day of oil by late 2027, one quarter earlier than originally planned, the Vancouver-based company said in a release. IPC could expand output from Blackrod to as much as 80,000 barrels a day in future phases. The project was delivered mostly on budget, costing roughly US$5 million more than originally planned.

Blackrod is the first so-called greenfield oilsands project to move forward since oil prices collapsed around 2014, prompting companies to focus on cutting costs and efficiency rather than growth. Major international oil companies such as Shell PLC and BP PLC sold oilsands assets to invest in other areas including shale. While oilsands production has grown, it’s happened mostly through incremental expansions of existing sites.

The new site begins production just as a wave of new and expanded export pipelines are planned that will require oilsands producers to grow output at a pace not seen in more than a decade. Canada is the world’s fourth-largest oil producer, with most of its crude production coming from northern Alberta.

Bloomberg.com