CALGARY - Petro-Canada (TSX: PCA) and its two partners in the oil sands of Fort Hills, Alberta, announced Monday the postponement until next year, their investment decision Referring to the portion of the mining project.
The three partners also decided to postpone the time for the construction of a factory recovery to reduce the risks related to overall costs of the project.
Petro-Canada, UTS Energy (TSX: UTS) and Teck Cominco (TSX: TCK.B) will review each contract procurement and construction in order to reduce project costs, which currently reach nearly $ 24 billion, said Neil Camarta, senior vice president for oil sands Petro-Canada.
"We will review each of these suppliers, each of these contractors, and have a little conversation to see how they are more hungry than they were a few months ago," he told analysts and journalists during a conference call Monday.
The Petro-Canada in the joint venture is 60 percent, those of Teck and UTS to 20 percent each. The three companies have recently announced that the costs of the project, originally $ 14 billion, had increased sharply.
So far, three companies have spent $ 1.7 billion project at Fort Hills. They had previously to an announcement before the end of this year, but now say they expect to do so in 2009, at least in regard to the mine.
Mr. Camarta said that the reasons for it should seem obvious.
"The current cost of Fort Hills were set this summer. Since then, oil prices have fallen. We face great uncertainty in the financial markets," he said, while the price of a barrel of crude was less than U.S. $ 67 on the Exchange of raw New York (NYMEX).
"The good news is that we can benefit from the easing of the market for sharpening our pencils and lower costs. This is a huge undertaking, and we must take a little longer to do things "Camarta said.
At the Toronto Stock Exchange, Monday, the stock price of Petro-Canada finished the day at $ 23.95, down $ 1.83 from its previous closing rate. Titles Teck Cominco and UTS Energy have also closed at $ 6.64 and 80 cents, up 29 cents and 11 cents lower, respectively.
The three partners also decided to postpone the time for the construction of a factory recovery to reduce the risks related to overall costs of the project.
Petro-Canada, UTS Energy (TSX: UTS) and Teck Cominco (TSX: TCK.B) will review each contract procurement and construction in order to reduce project costs, which currently reach nearly $ 24 billion, said Neil Camarta, senior vice president for oil sands Petro-Canada.
"We will review each of these suppliers, each of these contractors, and have a little conversation to see how they are more hungry than they were a few months ago," he told analysts and journalists during a conference call Monday.
The Petro-Canada in the joint venture is 60 percent, those of Teck and UTS to 20 percent each. The three companies have recently announced that the costs of the project, originally $ 14 billion, had increased sharply.
So far, three companies have spent $ 1.7 billion project at Fort Hills. They had previously to an announcement before the end of this year, but now say they expect to do so in 2009, at least in regard to the mine.
Mr. Camarta said that the reasons for it should seem obvious.
"The current cost of Fort Hills were set this summer. Since then, oil prices have fallen. We face great uncertainty in the financial markets," he said, while the price of a barrel of crude was less than U.S. $ 67 on the Exchange of raw New York (NYMEX).
"The good news is that we can benefit from the easing of the market for sharpening our pencils and lower costs. This is a huge undertaking, and we must take a little longer to do things "Camarta said.
At the Toronto Stock Exchange, Monday, the stock price of Petro-Canada finished the day at $ 23.95, down $ 1.83 from its previous closing rate. Titles Teck Cominco and UTS Energy have also closed at $ 6.64 and 80 cents, up 29 cents and 11 cents lower, respectively.
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