04 December 2008 16:41 [Source: ICIS news]
Prohibitive construction costs, the state of the global economy, uncertain oil price outlook and lack of legislative clarity are the main reasons for this decision.
In May 2008, StatoilHydro decided to postpone the planned upgrader, which was process bitumen from oil sands into a synthetic crude oil, by two years to 2016
It has since continued to monitor the cost and price environment and reassess downstream options, in line with several other players in the Canadian oil sands industry.
"This decision does not impact the progress of StatoilHydro's upstream oil sands activities. StatoilHydro¹s long term view of the Canadian oil sands development remains unchanged," said StatoilHydro
The construction of its Leismer steam assisted gravity drainage (SAGD - a method to extract bitumen from tar sand) project was progressing according to plan with start-up set for late 2010, it said. Production from the project would be marketed as unprocessed bitumen.
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