OPTI Canada Inc. is a Calgary, Alberta-based company, established in 1999 to develop major integrated bitumen and heavy oil projects in Canada using its proprietary, next-generation OrCrude™ process. OPTI is focused on developing the fourth and next major integrated oil sands project in Canada, Phase 1 of the Long Lake Project (the Project), in a 50/50 joint venture with Nexen Inc.

The Project will be the first to utilize OPTI’s OrCrude™ process, integrated with proven gasification and hydrocracking processes. Through gasification, this configuration substantially reduces the exposure to and the need to purchase natural gas. Through these processes, it is anticipated that the Project will deliver one of the highest quality synthetic crude oils ever produced from the Canadian oil sands with very low operating costs.

The first phase of the Project consists of 72,000 barrels per day of SAGD (steam assisted gravity drainage) oil production. The Project is expected to produce 58,500 barrels per day (bbl/d) of products, primarily 39° API Premium Sweet Crude (PSCTM) with low sulphur content, which makes it a highly desirable refinery feedstock. First synthetic volumes of PSCTM are expected shortly, once the hydrocracker and sulphur units have started. 

We and Nexen Inc. have agreed to defer sanctioning of Phase 2 but to continue to advance up-front engineering and planning in order to be in a position to sanction towards the end of 2009. The decision to defer Phase 2 is based on a combination of the following factors: uncertain financial markets, an escalating capital cost environment, pending regulatory approval for the SAGD portion of the project and lack of clarity on carbon dioxide (CO2) regulations. The additional time is expected to allow us to increase the level of execution preparation and planning in advance of a sanctioning decision.