CALGARY, Feb. 13, 2012 /CNW/ - MEG Energy Corp. reports that it now has regulatory authorization to proceed with its Christina Lake Phase 3 Project, following approvals issued by Alberta Environment and Water and the previous approval on January 31, 2012 by Alberta's Energy Resources Conservation Board. Engineering work on the 150,000 barrel per day project is currently underway, including a planned $60 million investment this year to assess optimum sizing and timing for the initial phase of the multistage project.
"With today's announcement, we now have approvals in place for 210,000 barrels per day of design production capacity at Christina Lake," said Bill McCaffrey, MEG President and Chief Executive Officer. "This is just another step in our strategy to increase production capacity tenfold by 2020."
Phase 3 is a multi-stage expansion of MEG's current Christina Lake Phases 1 and 2. Like previous phases, Phase 3 will use steam assisted gravity drainage, a thermal recovery technology that limits surface land disturbance and recycles approximately 90% of the water used in the process.
"Our employees, investors and community stakeholders will see a consistent approach to Phase 3," said McCaffrey. "In terms of the reservoir, we see characteristics similar to our current producing areas. In terms of project execution, we'll continue to focus on carefully staged capital investment and ongoing efforts to minimize environmental impacts in the region. Our work with regional stakeholders will continue through the full development process."
Project cost estimates for the first stage, Phase 3A, will be provided to MEG's Board of Directors for final sanctioning once engineering is sufficiently advanced.
MEG Energy Corp. is focused on sustainable in situ oil sands development and production in the southern Athabasca region of Alberta, Canada. MEG is actively developing enhanced oil recovery projects that utilize SAGD extraction methods. MEG's common shares are listed on the Toronto Stock Exchange under the symbol "MEG."
This news release contains forward-looking information including but not limited to: expectations of future production; water recycle rates; development plans, timing for completion, production capacities and performance of the future phases and expansions of the Christina Lake project and MEG's other projects. All such forward-looking information is based on management's expectations and assumptions regarding future growth, results of operations, production, future capital and other expenditures (including the amount, nature and sources of funding thereof), plans for and results of drilling activity, environmental matters, business prospects and opportunities. By its nature, such forward-looking information involves significant known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated. These risks include, but are not limited to: risks and delays in the development of or in the production associated with MEG's projects; the securing of adequate supplies and access to markets and transportation infrastructure; the uncertainty of estimates and projections relating to production, costs and revenues; health, safety and environmental risks; risks of legislative and regulatory changes to, amongst other things, tax, land use, royalty and environmental laws; changes in commodity prices and foreign exchange rates; and risks and uncertainties associated with securing and maintaining the necessary regulatory approvals, joint venture approvals and financing to proceed with the development of MEG's projects and facilities. Although MEG believes that the assumptions supporting such forward-looking information are reasonable, there can be no assurance that such assumptions will be correct. Accordingly, readers are cautioned that the actual results achieved may vary from the forward-looking information provided herein and that the variations may be material. Readers are also cautioned that the foregoing list of assumptions, risks and factors is not exhaustive. The forward-looking information included in this press release is expressly qualified in its entirety by the foregoing cautionary statements. Unless otherwise stated, the forward-looking information included in this press release is made as of the date of this document and MEG assumes no obligation to update or revise any forward-looking information to reflect new events or circumstances, except as required by law. For more information regarding forward-looking information see "Risk Factors" and "Regulatory Matters" within MEG's annual information form dated February 24, 2011 (the "AIF") along with MEG's other public disclosure documents. A copy of the AIF and of MEG's other public disclosure documents are available through the SEDAR website (www.sedar.com) or by contacting MEG's investor relations department.
For further information:
Director, External Communications
Director, Investor Relations