Capex Data
In December 2008, OPTI entered into a definitive agreement to sell a 15% working interest in all its joint venture assets to Nexen Inc. for $735 million. Following the transaction OPTI will have a 35% working interest in all the joint venture assets, including Phase 1 of the Long Lake Project (the Project), future phase reserves and resources, and future phases of development.
2009 Capital Expenditure Plans
OPTI's capital expenditure plans for 2009 will be significantly reduced as a result of this transaction to approximately $114 million for our new working interest share. Approximately $71 million of 2009 capital expenditures relate to OPTI's share of costs for Long Lake Phase 1. Phase 1 expenditures will be primarily directed towards sustaining capital for the SAGD operation, including the drilling of the first sustaining well pad, sustaining capital for the Upgrader, and costs associated with start-up of the SAGD debottlenecking project. As previously announced, final construction completion of the ash processing unit has been deferred to 2010 in order to avoid interference with initial Upgrader operations and to reduce 2009 capital expenditures.
In light of the current global economic situation and reduced commodity prices, the joint venture partners have agreed to reduce near term capital expenditures on future phases of development. OPTI anticipates remaining capital expenditures of approximately $43 million in 2009 primarily to advance Phase 2 planning, drill delineation wells in the Phase 2 area to define future horizontal well locations, and to advance regulatory work for the Phase 3 upgrader. The partners have also agreed that Phase 2 will not be presented for approval prior to mid-2010.
Future Plans
No data yet.