OPTI Canada Provides Project Update



    TSX: OPC

    CALGARY, Sept. 2 /CNW/ - OPTI Canada Inc. (OPTI) announces the following
project update on Phase 1 of its Long Lake Project (the Project).
    The Project remains on-track for Upgrader start-up and first commercial
production of Premium Sweet Crude (PSC(TM)) this month. Repairs have been
completed on the liquid oxygen storage tank and the air separation plant is
producing oxygen. The final major pre-operational activity, testing of the
gasifiers, has commenced and is expected to be completed in the next few
weeks. Other silos in the Upgrader, including the OrCrude(TM) unit,
hydrocracker, and sulphur recovery unit are operationally ready to start-up.
    Recent evaluations of Upgrader operational readiness have indicated that
the Upgrader can be started up with approximately 23,000 to 25,000 bbl/d of
bitumen in-take. Current SAGD production levels, in combination with
externally sourced bitumen, are expected to be sufficient to start-up the
Upgrader this month.
    Initial reservoir results continue to be positive and there are currently
40 well pairs in SAGD production. As previously announced, SAGD operations
have encountered a number of operational and surface factors that have led to
a slower than anticipated ramp-up of volumes. This included an unexpected
failure of a third party transformer on the main electrical grid that required
us to shut down our SAGD facilities and wells for a period of time. Recently,
the Project successfully tested its islanding capability thereby decreasing
the risk that future external grid failures will have a significant effect on
our operations. In mid-July, our third party pipeline encountered pump
reliability issues. This, in combination with full storage tanks caused us to
reduce bitumen production, thereby also affecting the steam to oil ratio
(SOR). During August, a number of valves controlling steam pressure into the
well pads failed.
    The start-up issues we encountered limited the amount of steam that we
were able to inject into the reservoir over the last two months and our
ability to consistently produce wells to their capability. Steam injection
directly impacts bitumen production, therefore each time our steam is
interrupted, our bitumen production temporarily decreases and takes time to
ramp back up. These issues had a significant impact on average monthly
production volumes in July and August, however, the reliability of our surface
facilities is improving and gross bitumen production volumes have been
increasing over the last three months as follows:

    
    -   In June, bitumen production volumes averaged 7,200 bbls/d with
        demonstrated production performance of over 10,000 bbls/d;

    -   In July, bitumen production volumes averaged 8,400 bbls/d with
        demonstrated production performance of over 13,000 bbls/d; and

    -   In August, bitumen production volumes averaged 11,600 bbls/d with
        demonstrated production performance of over 15,000 bbls/d.
    

    We expect bitumen production volumes to continue to increase as the
surface issues previously identified are largely behind us and shut-in wells
are being brought back on stream.
    In light of the surface issues encountered over the last two months, we
restricted steam injection rates. Because our storage tanks were full and we
could not ship, we restricted our bitumen production rates more than our steam
rates. This, combined with the conversion of new wells to SAGD operation,
resulted in our average steam-to-oil ratios (SOR) for the wells in SAGD
operation to temporarily increase from 3 to 4. This ratio is expected to
decrease to our long-term expectation of approximately 3.0 as SAGD volumes
ramp up to full design rates of 72,000 bbls/d (36,000 bbls/d net to us).

    About OPTI

    OPTI Canada Inc. is a Calgary, Alberta-based company focused on
developing the fourth and next major integrated oil sands project in Canada,
the Long Lake Project, in a 50/50 joint venture with Nexen Inc. The first
phase of the Project consists of 72,000 barrels per day of SAGD (steam
assisted gravity drainage) oil production integrated with an OPTI-operated
upgrading facility, using OPTI's proprietary OrCrude(TM) process and
commercially available hydrocracking and gasification. Through gasification,
this configuration substantially reduces the exposure to and the need to
purchase natural gas. The Project is expected to produce 58,500 bbl/d of
products, primarily 39 degree API Premium Sweet Crude with low sulphur
content, making it a highly desirable refinery feedstock. OPTI's common shares
trade on the Toronto Stock Exchange under the symbol OPC.
    Additional information regarding the Long Lake Project is available at
http://www.longlake.ca.

    Forward-Looking Statements

    Certain statements contained herein are forward-looking statements,
including statements relating to: OPTI's operations; business prospects,
expansion plans and strategies; OPTI's plans and expectations concerning the
use and performance of the OrCrude(TM) process and other related technologies;
the cost, development and operation of the Long Lake Project and OPTI's
relationship with Nexen Inc. Forward-looking information typically contains
statements with words such as "intends," "anticipate," "estimate," "expect,"
"potential," "could," "plan" or similar words suggesting future outcomes.
Readers are cautioned not to place undue reliance on forward-looking
information because it is possible that expectations, predictions, forecasts,
projections and other forms of forward-looking information will not be
achieved by OPTI. By its nature, forward-looking information involves numerous
assumptions, inherent risks and uncertainties. A change in any one of these
factors could cause actual events or results to differ materially from those
projected in the forward-looking information. Although OPTI believes that the
expectations reflected in such forward-looking statements are reasonable, OPTI
can give no assurance that such expectations will prove to be correct.
Forward-looking statements are based on current expectations, estimates and
projections that involve a number of risks and uncertainties which could cause
actual results to differ materially from those anticipated by OPTI and
described in the forward-looking statements or information. The
forward-looking statements are based on a number of assumptions which may
prove to be incorrect. In addition to other assumptions identified herein, we
have made assumptions regarding, among other things: market costs and other
variables affecting operating costs of the Project; the ability of the Long
Lake joint venture partners to obtain equipment, services and supplies,
including labour, in a timely and cost-effective manner; the availability and
costs of financing; oil prices and market price for the PSC(TM) output of the
OrCrude(TM) Upgrader; foreign currency exchange rates and hedging risks;
government regulations and royalty regimes; the degree of risk that
governmental approvals may be delayed or withheld; other risks and
uncertainties described elsewhere in this document or in OPTI's other filings
with Canadian securities authorities.
    Readers should be aware that the list of factors, risks and uncertainties
set forth above are not exhaustive. Readers should refer to OPTI's current
Annual Information Form, which is available at www.sedar.com, for a detailed
discussion of these factors, risks and uncertainties. The forward-looking
statements or information contained in this document are made as of the date
hereof and OPTI undertakes no obligation to update publicly or revise any
forward-looking statements or information, whether as a result of new
information, future events or otherwise, unless so required by applicable laws
or regulatory policies.

    %CIK: 0001177446




For further information:

For further information: Alison Trollope, Investor Relations Manager,
(403) 218-4705; OPTI Canada Inc., Suite 2100, 555 - 4th Ave. S.W., Calgary,
Alberta, Canada, T2P 3E7

Organization Profile

OPTI CANADA INC.

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