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By Samuel R. Avro on Nov 28, 2008 with no responses

Shell Delays Development of Canadian Oil Sands Project

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Royal Dutch Shell announced on Thursday that it had withdrawn its regulatory permit for a 100,000 barrel per day thermal project in order to shave costs and revamp the project.

Last month, Shell also delayed an expansion of its oil sands operations as the extraction cost rose and crude prices plummeted.

The Alberta oil sands are the worlds largest reserves outside of the Middle East, but are expensive and technically challenging to extract. There are 173 billion barrels of oil in the oil sands proven to be recoverable with today’s technology and under current economic conditions.

“The review is looking at opportunities to reduce costs and improve the profitability of the project,” a company spokeswoman said. “As a result of that we expect there will be some changes … Rather than update the application we decided the best path forward is to submit a new application.”