Murphy Oil Operations in the PEACE RIVER AREA

Transcription

1 Murphy Oil Operations in the PEACE RIVER AREA April 27 th, 2015 Craig Sinclair Manager, Special Projects MURPHY OIL CORPORATION NYSE: MUR 1

2 Our purpose today includes: Our Purpose Today Introducing Murphy Oil s global operations; Providing a brief overview of Murphy's current primary as well as possible future thermal operations in Northern Sunrise County; Describing the actions and commitments that arose from the AER s March 31 st, 2014 Inquiry into Odours and Emissions from Heavy Oil; Providing an update on the March 1 st, 2015 Seal condensate spill; and Answering any questions you may have arising from this presentation MURPHY OIL CORPORATION NYSE: MUR 2

3 Murphy s Current Peace River Operations (2015) Murphy is an international company producing oil and gas in the U.S., Malaysia, Canada, and various other countries. In Canada, Murphy is the operator in two areas: Northern B.C. (Dawson Creek); Northern Alberta (Peace River) Murphy has been operating in the Peace River area since 2003 Current Peace River operations are made up of: Cold Heavy Oil Cliffdale 2 well pads 13 well Seal Lake 95 well pads/4 central treat facilities Thermal Heavy Oil Cadotte Pilot 2 well pads MURPHY OIL CORPORATION NYSE: MUR 3

4 Murphy s Current Peace River Oil and Gas Production Murphy Field Number of Facilities Oil Production (bbl/d) Raw Gas Production Internal Gas Use Sales Gas Gas Flared Gas Vented Cadotte 4* Cliffdale Seal Lake 95 1, Total 112 1, ** * Includes both cold and thermal production ** The gas targeted for reduction in Murphy s Integrated Action Plan, submitted to the AER on Oct 31 st, 2014 MURPHY OIL CORPORATION NYSE: MUR 4

5 New Developments: The Seal Central HCSS Thermal Project The Project Uses Horizontal Cyclic Steam Stimulation (HCSS) Est. 12,450 bbl/day bitumen production Initially 7 well pads/84 producing wells Project life 35 years Schedule File application (complete) Q Start construction Q First steam Q Socio/Economics Total capital cost $624 million Total Prov. employment 2,000 P-Y Total Prov. income $254 million GDP created $414 million MURPHY OIL CORPORATION NYSE: MUR 5

6 Murphy s Response to the AER 2014 Inquiry into Heavy Oil Emissions AER s concerns included possible health and other effects form heavy oil emission To address these, the AER required that all Peace River operators move to: Eliminate both routine and non routine venting Substantially reduce routine flaring and increase gas conservation Significantly reduce emergency flaring Murphy s plans, as approved by the AER, have resulted in: The effective elimination of routine and non-routine venting at Three Creeks by Aug, 15, 2014 A steady and meaningful reduction in routine and non-routine venting at Seal beginning in Q and to be complete by Q Ongoing improvements in gas conservation and emergency flaring controls over the same time frame AER inspections continue to confirm that Murphy s operations are in full compliance with AER requirements MURPHY OIL CORPORATION NYSE: MUR 6

7 The Condensate Transfer Pipeline Release On March 1, 2015 a Murphy employee located condensate pooling at 3 separate locations over 1 km along a 7.8 km condensate transfer pipeline located with the Murphy Seal Lake development area. Condensate, which has several characteristics in common with gasoline, is used to dilute the much heavier bitumen so that it can be shipped by pipeline. Upon discovery the pipeline was immediately de-pressurized, Murphy s Emergency Response Plan and a wildlife deterrent program were initiated, access was limited to essential personnel, and the AER was notified. Trenches and berms now prevent the spill from spreading on the surface; and ongoing testing has confirmed the spill is not moving below ground and there was no risk of a similar release from another Murphy pipeline. Murphy is now actively removing liquid condensate from the three surface sites as an initial step in the eventual remediation and reclamation of the entire spill site. In the interim ongoing monitoring along with AER inspections continue to confirm that the spill does not present a risk to health and safety or the environment. MURPHY OIL CORPORATION NYSE: MUR 7

8 Thank You! Thank you for your time and attention.? We would be pleased to try to answer any questions you might have MURPHY OIL CORPORATION NYSE: MUR 8