Kearl Expansion Project
Kearl Phase 2 is one of Canada’s biggest open-pit bitumen mining projects, situated around 78km northeast of Fort McMurray in Alberta, Canada. The site began operations in June 2015 and is expected to reach full production of 110,000 barrels per day upon its completion.
This onshore rig is jointly owned by ExxonMobil and Imperial Oil, with the latter being its main operator. The total cost of Kearl 2 is estimated to be $9 billion.
Initial construction of the site involved clearing around 3,000 hectares of forest and digging out 6.1 million cubic metres of muskeg. It also included extraction and segregation of close to 4.8 million cubic metres of sub and topsoil.
Other subsidiary groundwork activities were 42 million cubic metres of standard excavation, 21.5 m cubic metres of dyke edging fills, 1.9m cubic metres of granular-fill as well as 1.4 m cubic metres of drainage and ditching. The tasks also involved creation of access roads, digging out the opening cut and assembling a tailings dyke. Overall, pre-construction stage involved relocation of close to 50 million cubic metres of matter.
Upon completion of the project, Imperial Oil is expected to produce a total of 169 billion barrels-of-bitumen from the site. Moreover, reserve estimate is expected to rise to 1.8 trillion barrels on secondary exploration using modern technologies. So far the Kearl project has employed around 5,000 people.
Imperial Oil owns 71pct stake in the venture, whereas ExxonMobil Canada has a share of 29pct. The expansion work involved 33 million manhours from employees, with Amec Foster Wheeler being the main contractor.
Likewise, Flour Company provided construction management services for Kearl Phase 2. They offered the infrastructure and offlease facilities, including the laboratory and control building, pipelines, river water intake infrastructure, non-process building facilities, as well as 240-kV powerline connectivity to the local utility network.
Imperial Oil’s drilling approach of ‘design-one/build-multiple’ helped reduce contractor manhours by 30pct from 34 million on the 1st Kearl development, to 24 million on the second expansion. Moreover, construction months were subsidized from 36 months in the first development, to 28 months in the expansion phase.
Stakeholders attribute the success of this project to ExxonMobil’s expertise in drilling site planning and execution, including strong relationships built with local Alberta-based contractors. A key feature of the new project will include comprehensive modules being constructed in Edmonton, safety performance has also been improved three-fold by the team.
For the first phase, it took approximately 23 months to have all 3 trains produce a sustained bitumen volume of 150,000 barrels per day. However, on Kearl Phase 2 the feat was attained in only 20 days.
Widely regarded as the next big thing in oil-sands mining, Imperial’s exclusive paraffinic froth treatment procedure eliminates the need for on-site upgrading, thus reducing the project’s greenhouse gas emissions. Since Kearl Expansion Project Phase 2 only produces diluted bitumen, it has much less carbon footprint compared to other drilling sites.
The project has also injected a lot of money into Canada’s economy, for instance, Imperial stated that out of the project’s estimated $9 billion investment about 90pct was spent with Canadian-based firms in Alberta area. Similarly, around $500 million was distributed to contractors and local suppliers within Wood Buffalo region.
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