OPTI Canada is a Calgary,

Alberta Alberta ( ) is one of the thirteen provinces and territories of Canada. It is part of Western Canada and is one of the three prairie provinces. Alberta is bordered by British Columbia to the west, Saskatchewan to the east, the Northwest Ter ...

based

oil sands Oil sands, tar sands, crude bitumen, or bituminous sands, are a type of unconventional petroleum deposit. Oil sands are either loose sands or partially consolidated sandstone containing a naturally occurring mixture of sand, clay, and wate ...

development company. Established in 1999, its sole project is the Long Lake oil sands project, of which it owns 35%. The remaining 65% is owned by project operator

Nexen Inc CNOOC Petroleum North America ULC, formerly known as Nexen, is a Canadian oil and gas company based in Calgary, Alberta. Originally the Canadian subsidiary of US-based Occidental Petroleum (known as Canadian Occidental Petroleum or CanOxy), ...

History

OPTI was founded as Ormat Process Technologies Inc. in 1999 by

Israel Israel (; he, יִשְׂרָאֵל, ; ar, إِسْرَائِيل, ), officially the State of Israel ( he, מְדִינַת יִשְׂרָאֵל, label=none, translit=Medīnat Yīsrāʾēl; ), is a country in Western Asia. It is situated ...

i energy company

Ormat Industries Ormat Technologies, Inc. is an international company based in Reno, Nevada, United States. Ormat supplies alternative and renewable geothermal energy technology. The company has built over 190 power plants and installed over 3,200 MW. As of J ...

, which had developed the OrCrude process in the 1990s. Ormat was approached by Calgary-based Nexen, who sent a delegation to Israel to supervise a test of the process. However, using OrCrude in the oil sands appeared uneconomical to Nexen, who withdrew. Ormat instead contacted Calgary's

Suncor Energy Suncor Energy (french: Suncor Énergie) is a Canadian integrated energy company based in Calgary, Alberta. It specializes in production of synthetic crude from oil sands. In the 2020 Forbes Global 2000, Suncor Energy was ranked as the 48th-lar ...

, with whom it founded OPTI as a 50-50 venture, with the Nexen delegation's head, Jim Arnold, as its first employee. Suncor's land at Burnt Lake was used by Ormat to build an OrCrude demonstration plant, using oil supplied by Suncor. However, Suncor soon withdrew from the venture, and Nexen returned to take a 50% stake. In 2004, the OPTI decided to expand Long Lake to commercial-scale, and raised over $1.5 billion of private equity and debt. Also in 2004, OPTI underwent a $300 million

initial public offering An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investme ...

(IPO). In January 2009 OPTI sold 15% working interest in Long Lake project to Nexen for $735 million, following an 89% drop in share price and increasing expenses. In early 2011 OPTI faced severe liquidity problems and an inability to service its $2.8 billion debt. Its shareprice closed at $0.30 on February 4, 2011, down from a high of $24.85 in 2008. Analysts believed bankruptcy or restructuring of the company was likely. On November 28, 2011, it was announced the company had been acquired by CNOOC Luxembourg S.à r.l, an indirect wholly owned subsidiary of

CNOOC Limited CNOOC Limited () is China's largest producer of offshore crude oil and natural gas, noted as such in 2010. It is a major subsidiary of China National Offshore Oil Corporation (CNOOC) and has been listed in Hong Kong since February 2001. It w ...

. The total value of the acquisition was approximately US$2.1 billion.

Long Lake

The Long Lake project uses OPTI's proprietary OrCrude process, which produces usable fuel from byproducts of extracted bitumen. This fuel is used to generate steam for bitumen extraction using steam-assisted gravity drainage (SAGD) technology. OrCrude additionally produces

hydrogen Hydrogen is the chemical element with the symbol H and atomic number 1. Hydrogen is the lightest element. At standard conditions hydrogen is a gas of diatomic molecules having the formula . It is colorless, odorless, tasteless, non-toxic ...

, which is used for hydrocracking in the refining process. Typically,

natural gas Natural gas (also called fossil gas or simply gas) is a naturally occurring mixture of gaseous hydrocarbons consisting primarily of methane in addition to various smaller amounts of other higher alkanes. Low levels of trace gases like carbo ...

is used to generate steam for SAGD extraction. However, using OrCrude-generated fuel significantly reduces the need for natural gas, reducing OPTI's operating costs by approximately $10 per barrel of oil produced.

References

{{reflist Companies based in Calgary Companies formerly listed on the Toronto Stock Exchange