A ray of Sunshine
February 28, 2013
Sunshine Oilsands Ltd. (ticker SUO), the first Canadian oil-sands operator to list shares on the Hong Kong exchange, is in “advanced” talks with joint-venture partners to boost production to a potential 1 million barrels a day.
After the completion of the 2012 drilling and seismic program Sunshine has:
- Approximately 70 billion barrels of best estimate oil.
- Approximately 5 billion barrels best estimate contingent resource with an aggregate pre-tax PV10% value of $6.9 billion
- 80 million barrels of 1P (proven) reserves with an aggregate pre-tax PV10% value of $312 million
- 445 million barrels of 2P (proven plus probable) reserves with an aggregate pre-tax PV10% value of $918 million
- 603 million barrels of 3P (proven plus probable plus possible) reserves with an aggregate pre-tax PV10% of $1.6 billion
- Announced a C$390 Million 2013 Capital Budget Focused on Initiating Thermal Production
Sunshine is producing about 500 barrels a day right now. The company probably will need to invest about C$15 billion in equipment and operations as it boosts production.
Sunshine is a portend for the future. Chinese capital + Canadian expertise to exploit a northern resource, in this case the oil sands using SAGD technology. The company’s presentation shows a high degree of concern with the environment and advocates minimizing air and water impacts.