Crude Oil – Pembina Enhanced Recovery Project
Pembina Cardium – Central Alberta
The Pembina Enhanced Recovery Project is located approximately 125 kilometers southwest of Edmonton, Alberta. The Pembina Cardium’s 7.8 billion barrels of original-oil-in-place (OOIP) make it the largest conventional oil field in Canada. Penn West began by consolidating its interests in the field in 1995, and currently operates a significant portion of this pool and its infrastructure. Current conventional activity in Pembina includes infill drilling, pressure maintenance through water injection and optimization.
Recognizing the size of the pool, it’s important to note that any activity that has the potential to increase the pool’s recovery factor will unlock multiple millions of barrels of oil. For example, an increase of one percent in pool recovery will add 78 million barrels of recoverable oil.
Our presence in Pembina provides us with a unique ability to unlock these reserves. Since 1995, we have accumulated valuable knowledge and experience in the area of tertiary or “enhanced” oil recovery. Currently, Penn West operates the only commercial CO2 miscible flood in Alberta at Joffre. Penn West also operates a large hydrocarbon miscible flood at Swan Hills in Alberta, and has working interests in the Virginia Hills miscible flood and the Midale CO2 miscible flood. This experience makes Penn West an industry leader in enhanced recovery and in CO2 technology. The combination of our dominant presence in Pembina and our extensive knowledge of tertiary recovery positions Penn West Energy Trust to begin to unlock Pembina’s potential.
Pembina Enhanced Recovery Project
In the winter of 2005, Penn West initiated a CO2 pilot project in Pembina. Thus far the pilot has been a success. CO2 has been contained, we have not experienced premature breakthrough, and well oil production has increased. The initial success of the pilot provides an excellent lead in to a full scale commercial project.
Penn West has been working with a large industrial emitter of CO2 on an economic CO2 capture and pipeline transportation project. The CO2 will be supplied to Penn West in sufficient quantities to support commercial applications of enhanced oil recovery technology in phases over a significant portion of our lands in Pembina.
Currently, Penn West is working toward the construction of a pipeline spine from the CO2 source to the Pembina field, a distance of about 150 kilometers. We envision that this pipeline spine will be used not only to supply Pembina, but also other fields in Central Alberta including fields where Penn West has interests.
The first phase of the Pembina Enhanced Recovery Project will include construction of a CO2 supply pipeline, infill drilling, well recompletions, and field facility upgrades. Estimated cost of this work to Penn West will be $200 to $250 million. We anticipate that production from the first phase will commence in 2009 and will average 5,000 to 8,000 barrels per day. Multiple additional phases are planned. The additional phases will not require the per unit expenditure of the first phase since the supply pipeline and the proportion of the facility upgrades are part of phase one.
