BlackPearl Resources Inc. is continuing to construct its second 6,000 barrels per-day heavy-oil thermal project at Onion Lake Cree Nation Sask. with plans to supply up to 1.64 million cubic metres of water a year to generate steam.
The company drilled water source wells earlier this year, and has applied to the Saskatchewan Water Security Agency for approval to construct an induced surface water infiltration well field and associated pipelines.
If approved, the infiltration well field will be located along the north bank of the North Saskatchewan River, with the Water Security Agency recently filing public notice of BlackPearl’s application.
Anyone who objects to the water agency granting approval for the project pursuant to the Water Security Agency Act may file a written objection within the first 30 days from the publication of the notice to the agency in Moose Jaw Sask.
Meanwhile, BlackPearl plans to transfer equipment modules being built in a fabrication shop in Calgary on site when they are completed.
The company reported the modules were 80 per cent completed on June 30.
They expect to conduct field assembly of modules for the central processing facilities and pad facilities, and work throughout the summer and fall with drilling already underway.
BlackPearl initially plans to drill 14 horizontal producer wells, three horizontal steam injector wells and 20 vertical injector/observation wells to produce oil with a modified steam assisted gravity drainage (SAGD) process.
The process will use existing and new vertical wells as steam injectors and horizontal producers, which were used for Phase 1 and the more traditional SAGD process with two horizontal wells drilled approximately five metres apart.
The company plans to begin steam injection by mid 2018 with peak production of 6,000 bbl/day by mid 2019.
BlackPearl notes Phase 1 continues to perform at or above name-plate capacity, while it operates with low royalties, operating costs and sustaining capital.
The first phase thermal was built for $225 million with a projected Phase 2 cost of $185 million.