While many companies in the oil and gas industry are shedding workers to cut costs, Imperial Oil has decided to look elsewhere to save money.
While many companies in the oil and gas industry are shedding workers to cut costs, Imperial Oil has decided to look elsewhere to save money.
"We have reduced our per barrel costs in the range of 25 per cent just by looking at every single thing that we do," said Pius Rolheiser, senior media advisor with Imperial Oil.
"We really try to engage everybody in the organization in looking at how we can challenge the status quo. Can we do things differently? Can we maybe not do certain things without impacting the integrity of the operation?"
Imperial Oil estimates that they have saved $1.1 billion in the first three quarters of 2015 due to cost management activities, which involved them making their operations more efficient.
These efficiencies were instituted across the board, with a lot of improvements coming to the company's massive Cold Lake operations.
Leming, Maskaw, Mahihkan, Mahkeses and Nabiye are the five facilities that make up Imperial Oil's Cold Lake project. Together these plants, consisting of 4,600 active wells, cover roughly 780 square kilometres of oil sands leases 50 kilometres northwest of Cold Lake. The combined production level is approximately 160,000 barrels of oil per day.
"We are very proud of our operations. Cold Lake is a world scale operation," said Rolheiser, of the project, which started back in 1985.
The 30 years of operation makes Imperial Oil's Cold Lake site the longest running in-situ oil project in Canada. Back in 2009 it produced its one-billionth barrel.
"We still think Cold Lake's best days are still in front of it," said Rolheiser.
The company is so invested in the project that they are already in the midst of a building a formal application to expand it.
An initial project summary proposing a new 55,000-barrel per day facility was submitted to the Alberta Energy Regulator earlier this year.
Imperial Oil held a public open house for the proposed Midzaghe (Dené for owl) operation to get public input on a facility that marks a new direction for the company.
The new facility would be a SA-SAGD (solvent-assisted steam assisted gravity drainage), which differs from the five other operations currently running CSS (cyclic steam simulation) technology.
While consultations went well in the summer, Imperial Oil gave residents another opportunity to learn more about the operation and ask questions at a recent Neighbour Night in Bonnyville.
"It is a great opportunity for us to tell people what we are doing," said Rolheiser. "There are some people familiar with our operations and others who are not. There were people here who didn't know anything about the Cold Lake operations."
Approximately 20 staff members from Imperial Oil were present for the event in the field house at the Bonnyville Centennial Centre on Nov. 19.
Experts in every field were present to field questions on every aspect of the Cold Lake operations, from safety, to environmental performance, to stakeholder relationships.
The Midzaghe project generated a lot of discussions due to the fact that it signals Imperial Oil's commitment to move ahead even with a tough economic climate.
"We are continuing the consultation part of the Midzaghe project with the goal of submitting a formal regulatory application sometime in 2016," said Rolheiser, saying that the company's near-term plans haven't changed.
While the company is still forging ahead with the cost of a barrel of oil hovering around the $40 mark, they aren't protected from the current market conditions.
"We aren't immune to the forces that everybody is feeling," said Rolheiser. "We feel the same cost pressures. We are subject to market forces that we don't control. The best we can do is to try and make our operations the best (they can be) in the industry under the current circumstances."
As for Midzaghe, the application preparation, submission and regulatory review process is expected to run into 2018. A decision of whether or not to move forward and proceed with construction of the facility wouldn't be made until early 2019. Should the company move forward they are estimating a production startup in 2022.
