UPDATE 1-Imperial Oil says Kearl oil sands start-up hampered by cold

Tue Jan 22, 2013 12:43pm EST
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* Expects production at oil sands mine in weeks

* Cold weather affecting start-up operations

* Shares slip 1 pct

CALGARY, Alberta, Jan 22 (Reuters) - Imperial Oil Ltd said on Tuesday that start-up of its new 110,000-barrel-per-day Kearl oil sands mine has been delayed by cold temperatures in northern Alberta but that it still expects production to begin early this year.

Pius Rolheiser, a spokesman for the company, said Imperial is still working to begin production at the C$10.9 billion ($11 billion) project, but believes it still has weeks of work ahead of it.

"We still anticipate first production in early 2013," he said. "Exactly when that will be will depend on how well we do in the coming weeks."

Traders have said that expectations of production from the development have been a factor in the recent deepening of discounts on Canadian heavy oil, as export pipeline capacity remains limited.

Temperatures in the Fort McMurray region in northeastern Alberta, where Kearl is located, have been dipping below -30 Celsius (-22 Fahrenheit) in recent days.

"Whenever you get weather like that it affects both people and equipment," Rolheiser said. "We are focused on completing start-up flawlessly and safely."   Continued...