Husky building two more Saskatchewan plants at a cost of $700 million
A year after it committed $1 billion to build three steam-assisted heavy oil extraction plants in western Saskatchewan, one of Canada’s largest energy companies says its board has approved two more of the facilities at a combined cost of $700 million.
Husky Energy Inc.’s decision to green light the plants — to be built at Westhazel, near Mervin, and Edam — is part of its broader strategy to approve two plants per year “for the foreseeable future,” according to a spokesman.
“That can’t continue endlessly, of course, but we do have a good pipeline of projects that we have on the horizon and we have outlined spending plans to bring forward two per year going forward,” Mel Duvall said Monday.
Each of the 10,000-barrels-perday plants is expected to create between 250 and 300 construction jobs, plus around 30 full-time permanent positions once they begin production, which is expected in 2021, Duvall said.
The Calgary-based company currently has four “thermal” plants under construction — Rush Lake 2, Dee Valley, Spruce Lake North and Spruce Lake Central — plus an additional four operating in the province: Rush Lake, Edam East, Edam West and Vawn.
Part of its strategy of shifting production to “low sustaining capital” operations, Husky’s Lloydminster-area plants feed its upgrader in the border city, which converts heavy crude into the synthetic oil needed to produce diesel and gasoline.
“All the signs are right for these projects,” Duvall said. “They’re bite-sized so it’s not like taking on a multibillion-dollar oilsands plant … They’ve just been very good for us.”
Duvall said many of Husky’s employees in the region live in North Battleford. The mayor of the city of 14,000 said Monday that the company’s current and planned projects in the area are “incredibly positive” news.
“There are a lot of jobs here that are generated by just the construction alone,” Ryan Bater said.
Saskatchewan Chamber of Commerce CEO Steve McLellan said that while it’s difficult to determine the exact economic impact of each plant, Husky’s plan will benefit local hotels, restaurants and other businesses as well as manufacturers and equipment distributors in Saskatoon.