Husky says C$3.2 bln Sunrise oil sands project begins production

Wed Mar 11, 2015 4:51pm EDT
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CALGARY, Alberta, March 11 (Reuters) - Husky Energy Inc , Canada's No.3 integrated oil producer and refiner, said on Wednesday it has started oil production at the C$3.2 billion ($2.5 billion) Sunrise oil sands project it co-owns with BP Plc.

The company, controlled by Hong Kong billionaire Li Ka-shing, said it does not expect the 60,000 barrel per day thermal project, where steam is pumped into the ground to liquefy tarry bitumen from the world's third-largest crude reserve, to reach full output until the end of 2016.

The company has been working at the site, 60 kilometers (37 miles) northeast of Fort McMurray, Alberta, for more than four years after sanctioning the project in late 2010. A second phase could boost output to 200,000 bpd if the two partners decide to go ahead with the expansion.

Husky shares fell 49 Canadian cents to C$25.72 on Wednesday on the Toronto Stock Exchange.

($1 = 1.2747 Canadian dollars) (Reporting by Scott Haggett; Editing by Diane Craft)