Husky looks west for unconventional energy growth
Husky Energy's Western Canadian operations are shifting from conventional production to so-called resource plays that take high-level technological expertise to exploit.
CALGARY: There’s a big shift is taking place at Husky Energy Inc.’s Western Canadian operations from conventional production to so-called resource plays – large, prolific resources that take a high degree of technological expertise to exploit.
“Western Canada in conventional terms is a declining basin. But before our very eyes, this is a basin that’s being regenerated by new technology – the new technology, basically, of resource plays,” said chief executive officer Asim Ghosh.
“And as a result we are repositioning this foundation.”
Currently just 10% of Husky’s holdings in Western Canada are considered to be unconventional ¬– tapped using complex horizontal wells and rock-fracturing techniques, for instance.
By 2016, chief operating officer Rob Peabody said the company sees that proportion growing to one-third.
“The transition in our Western Canada portfolio from conventional to resource plays will not occur overnight,” he said.
Currently, Husky’s Western Canada division produces about 160,000 barrels of oil equivalent per day, a level the company intends to maintain for the next four to five years.
Husky outlined its $4.7-billion 2012 capital-spending program, which includes $1 billion toward the Western Canadian Sedimentary Basin. The company said it was undertaking efforts to “reinvigorate and transform” that bread-and-butter part of its business.
Large amounts of capital are also being directed toward Husky’s Sunrise oil sands property, which it is jointly developing alongside BP PLC, as well as its offshore developments in the South China Sea.
Husky, controlled by Hong Kong billionaire Li Ka-Shing, produces oil and gas in Western Canada, off Canada’s east coast and in southeast Asia.
Husky also has interests in BP-operated refineries in the US and a chain of Husky-branded fuel retail outlets in Canada.
© 2011 The Canadian Press