Highlights

2006: What we promised, and what we delivered

Goal:
Start-up the SAGD operations with first steam injection in late 2006 - safely, on schedule and on budget.

  • While we achieved an excellent safety record in 2006, it was one of the busiest construction periods on record in Alberta.  As a result, our construction workforce ramped-up more slowly than we anticipated causing our schedule to shift slightly.
  • SAGD start-up began in mid-April of 2007.

Goal:
Continue Upgrader construction to meet target start-up date of mid-2007.  Our target is to have about 80 percent of construction completed by year-end.

  • Completed between 75-80 percent of Upgrader construction in 2006.
  • Upgrader start-up date shifted by about a quarter, it is now expected to start-up near the end of the third quarter of 2007.
  • Anticipating first production of PSCTM by the end of 2007.

Goal:
Continue to build a strong operations team as operator of the Upgrader.  By start-up in 2007, have approximately 200 employees in place.

  • At December 31, 2006, we had hired 85 percent of the Upgrader operations employees who are actively preparing for the safe, steady operation of the facility for 40 years.

Goal:
Advance Phase 2 with sufficient resource definition to apply for SAGD regulatory approval; accelerate engineering and planning for potential project sanctioning in 2008.

  • We achieved this goal and submitted a regulatory application for 140,000 bbl/d of SAGD production at Long Lake South - the site of Phase 2 SAGD operations.
  • We advanced our plans for Phase 2 in 2006, and will continue our detailed engineering work through 2007 in preparation for potential project sanctioning in 2008.

Goal:
Further delineation of the resource base at Leismer and Cottonwood in preparation for Phases 3 & 4.

  • In the winter 2005/2006 drilling season, we completed 45 core holes and acquired over 100km of 2-D seismic on these properties to further advance planning of future phases of growth.


2007: What we are planning, and what we are committed to achieving

  • 100 percent safe performance in everything we do.
  • First bitumen production from our SAGD operations; exit year with volumes of 35,000-45,000 bbl/d of bitumen, and a steam oil ratio (SOR) of less than 4.0.
  • Production of our first synthetic crude from the OPTI-operated Upgrader by the end of 2007.
  • Complete approximately 30 percent of Phase 2 up-front engineering with a sufficiently defined cost estimate and schedule to be positioned for potential project sanctioning in 2008.
  • Further define resource base and refine plans for Phase 3 in support of our goal to achieve 180,000 bbl/d of PSCTM production via a multi-stage expansion plan.