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improve the company’s financial strength to support our significant growth plans.” The largest portion of the 2013 capital investment plan ($480 million) is directed to MEG’s RISER initiative, which focuses on increasing production and throughput capacity from the company’s existing facilities in the near term. As part of the initiative, MEG plans to deploy enhanced modified steam and gas push (eMSAGP) technology to additional well pads in 2013. Combined with initial production from the start-up of Christina Lake Phase 2B, which remains on budget and scheduled to begin steaming in the second half of the year, MEG is targeting average 2013 production volumes of 32,000–35,000 barrels per day with an exit rate of 37,000–43,000 barrels per day. “Our production target for 2013 is approximately 20 per cent above projected 2012 volumes, and we expect further increases that will double current rates in 2014,” said McCaffrey. At the same time, efficiency improvements with RISER are expected to reduce non-energy operating costs to $9–$11 per barrel in 2013 from MEG’s 2012 target of $10–$12 per barrel. In addition to planned spending on the RISER initiative, MEG is planning to invest approximately $700 million in growth capital at the company’s Christina Lake project. Planned investments include $170 million to complete construction of Phase 2B. Another $100 million will be spent on drilling and completion of an inventory of standby wells to take advantage of additional freed-up steam with the implementation of eMSAGP and $220 million for engineering, long lead-time items and site preparation for Phase 3A. A final capital cost estimate for Phase 3A is expected by mid-2013. As MEG has continued to advance engineering for Christina Lake Phase 3A, it has been identifying synergies with plans for Phase 3B processing facilities, said McCaffrey. “With twin plants located side by side, there are significant opportunities to optimize our investment for shared access, utilities and infrastructure, as well as leveraging our growing experience with RISER. We see significant benefits for both phases.” Christina Lake Phase 3A is currently planned for completion in 2016. With future development phases at Christina Lake and the initial phase of MEG’s Surmont project, the company is continuing to target installed production capacity of 260,000 barrels per day by the end of 2020.
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