VANCOUVER, British Columbia, Sept. 6 (UPI) -- A Vancouver, British Columbia, mining company will spend $400 million for a 15-percent stake in an Alberta oil sands project.
Oil sands become a commercially viable source of crude oil only when the commodity reaches unusually costly levels, as it has recently.
Teck Cominco Ltd., a major miner of zinc, copper and coal, will spend the money to get a 15-percent interest in Fort Hills Energy LP, a venture north of Fort McMurray, owned Petro-Canada and UTS Energy Corp, CBC reported.
The deal leaves Fort Hills 55 percent owned by Petro-Canada and 30 percent owned by UTS.
The Fort Hills site is estimated to hold 4.7 billion barrels of bitumen and carry production costs of $10 to $15 per barrel. The first phase of Fort Hills, based on a mine plan of 2.8 billion barrels, is expected to start production in 2010 at 100,000 barrels per day using conventional extraction technology.
Production could reach 190,000 barrels per day by 2013.
