Horizon Oil Sands

Horizon Oil Sands

Horizon Oil Sands Mining and Upgrading Activity

The Horizon Oil Sands include a surface oil sands mining and bitumen extraction plant, complemented by on-site bitumen upgrading with associated infrastructure to produce high quality synthetic crude oil ("SCO"). Canadian Natural holds extensive leases that are estimated 3.6 billion barrels of proved and probable SCO reserves. The Horizon Oil Sands are located on these leases just north of Fort McMurray, Alberta in the Athabasca region. Due to the massive resource base, the mine and plant facilities are expected to produce for decades to come without production declines normally associated with crude oil production.

Horizon – Current Phase

Construction progress to date at Horizon has met or exceeded expectations on cost and performance. Canadian Natural has a disciplined execution strategy, to achieve cost certainty for a defined and stepped expansion at our Horizon operations from Phase 1 productive capacity of 110,000 bbl/d to 250,000 bbl/d of SCO . As of Q4/14. the Horizon expansion project is 56% complete. In 2014, we advanced the completion of the project through the completion and commissioning of Phase 2A. This phase added 12,000 bbl/d of production capacity through the addition of an additional coker pair. Through this pahse and certain operational synergies, Canadian Natural was able to increase the name plate capacity to 137,000 bbl/d. In 2015, Canadian Natural will continue progress the expansion of Horizon with work on both Phases 2A and 3.

The timing of construction for future expansions is critical for cost control and we remain focused to take advantage of favorable market conditions. We are not driven to production increases at the expense of a higher capital cost. Current expansion and debottlenecking will be very deliberate and flexible to ensure projects can be started or stopped based on market conditions. The Horizon Oil Sands asset is substantial and anticipated to provide significant free cash flow well into the future. The development of this world class asset is predicated upon generating the greatest value for our shareholders.

Horizon – Planning - Past Phases

Canadian Natural's Board of Directors sanctioned the Horizon Oil Sands Project in February 2005 and after years of planning and construction, the Horizon Oil Sands successfully and sustainably produced its first barrels of high quality, low-sulphur, 34° API, sweet SCO in early 2009. First production of SCO was a major milestone for Canadian Natural and we were pleased with the success of the project. Acting as our own primary contractor on the Horizon Oil Sands, we built a core competency in executing large scale projects from the ground up and have learned a great deal from the construction and startup of Phase 1.

Phase 1 was just the first step in value creation from this significant asset. A considerable amount of capital for infrastructure was included in Phase 1 in anticipation of future phases. These include but are not limited to, support infrastructure such as the aerodrome, buildings, shops, warehouses, camps and roads, site preparation, the piperack, coker foundations, gas and power distributions, the majority of underground piping and so on. Canadian Natural is positioned to leverage the benefits from our existing operation into future expansions.

The expansions to the Horizon Oil Sands have been broken into five categories, in adopting this strategy and breaking the overall expansion into smaller, more manageable pieces Canadian Natural believes that this will lead to enhanced project and cost control. Phase 1 of the expansion was completed during 2009. This Phase included engineering and design specifications for greater production capacity, the setting of additional coker foundations, other supporting infrastructure, and the procurement of long lead equipment such as coke drums, reactors and mobile equipment. The current expansion has been re-profiled into five categories as follows:

 Horizon North Pit Extension (NPE) Project

Canadian Natural is proposing a northeast mine pit extension (NPE Project) of the previously approved North Mine Pit at the Horizon Oil Sands Processing Plant and Mine (Horizon). The extension will be immediately adjacent and east of the existing approved North Pit, west of the Athabasca River and is within the Alberta Energy Regulator’s Approved Project Area for Horizon.

The NPE Project is required to sustain approved production rate for Horizon that includes proposed extensions of approved and new overburden storage areas. The mine extension and the additional area required for overburden storage represents an increase in disturbance area of approximately 7% and 11%, respectively. The proposed extension will be actively mined for approximately seven years with all ore continuing to be processed at the existing Horizon Central Processing Facility. Accordingly, an increase in water withdrawal from the Athabasca River is not required for this Project.  The extension would be a continuation of the mine sequence, additional workforce would not be required and would not result in an increase in population, housing or camp requirements, local or regional traffic, and would not impact local or regional infrastructure or community services.

The area associated with the North Pit Extension was not previously included in the Horizon 2002 Environmental Impact Assessment. As a result, Canadian Natural is preparing an Environmental Impact Assessment for the proposed Project with a focus on the potential incremental impacts that may result from the extension. The Environmental Impact Assessment will assess the potential impacts of the project on surface water, aquatic resources, groundwater, air, soil, wildlife, vegetation, biodiversity, historical resources, resource use and traditional land use, and will outline Canadian Natural’s proposed mitigation measures, as required. Baseline studies have been initiated and will continue through 2017.

Canadian Natural will be seeking regulatory approvals by amending the current Horizon approvals under the Environmental Protection and Enhancement Act, Water Act, Public Lands Act and Oil Sands Conservation Act through an Integrated Application. Existing environmental management and monitoring programs will be expanded to accommodate the development of the proposed Project.

The NPE Project is expected to include the following changes to the Horizon Mine:

  • Extension of the approved north mine pit to include the NPE Project area (1,346 ha);
  • Additional overburden storage areas (2,102 ha); and
  • Updated closure and reclamation plans.

Details regarding the project can be viewed in the following documents:

For further information on the project or associated project information, please contact Canadian Natural Resources Limited by email and attention to either: Mrs. Anita Sartori (Manager, Projects & Approvals, Development Operations).


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