October 18, 2010 / 2:52 PM / 7 years ago

UPDATE 1-Southern Pacific gets nod for McKay project, shares up

2 Min Read

* Reports nine-fold increase in total proved reserves

* Sees total proved reserves of 63.1 MMBOE

* Shares up as much as 8 pct

Oct 18 (Reuters) - Southern Pacific Resource Corp STP.TO received Alberta government's approval for development of its McKay oil sands project and reported more than nine-fold increase in project's total proved reserves, sending its shares up about 8 percent on Monday.

The Calgary, Alberta-based company is developing 12,000 barrels per day STP-McKay Thermal project.

The company said its application was thoroughly reviewed by Energy Resources Conservation Board and Alberta Environment and and has met the regulatory requirements necessary for approval.

Southern Pacific reported 828 percent increase in total proved reserves at the project to 63.1 million barrels of oil equivalent as of Oct. 15.

The estimated amount of total proven reserves represents about 13.5 years of production at design capacity from the STP-McKay Thermal Project, it said.

Southern Pacific shares, which have gained about a quarter of their value in last three months, were up about 3 percent to C$1.34 in morning trade on Toronto Stock Exchange.

They hit a high of C$1.40 earlier in the session. (Reporting by Ashutosh Joshi in Bangalore; Editing by Prem Udayabanu)

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