— Photo courtesy Komatsu Equipment/Suncor
CTV and Seeking Alpha are reporting that public hearings have begun to review Teck Resources' proposed $20B, 260K bbl/day Frontier oil sands mine project in Alberta. This potential development is seen as “a rare positive sign for Canada's oil sands industry.”
"We believe the long-term outlook for the global oil market is favourable for projects like Frontier," said Doug Brown, Teck's director of public affairs told CTV News. "Given the current project timing, and the future demand we see, we think it's a strong project to move ahead."
Teck believes the oil sands industry slowdown should mean construction and operating costs will be lower than during the boom years and the company should be able to integrate the latest and most efficient technologies.
However, Teck's estimates suggest the oil sands mine project will cost ~$80K per flowing barrel of oil, which is much higher than the $40k-$50K estimated to build a new steam-driven thermal oil sands project, says Kevin Birn, VP of North American crude oil markets for IHS Markit.
Financial analysts are suggesting that the Frontier project could be a financial stretch for Teck, as the estimated $20B price tag would make the project more expensive than Teck’s $18B market cap.
Read the full CTV News report here.
Source: Seeking Alpha
