Shell Canada budget falls after oilsands sale

CALGARY — The president of Shell Canada says his capital budget will shrink by about half a billion dollars this year following the sale of most of its oilsands assets in a deal that closed last week.

Michael Crothers says it will be about $1.5 billion this year, down from over $2 billion in 2016, but the Canadian branch remains an important part of Royal Dutch Shell’s global operations.

He said in an interview the company’s sale of oilsands assets to Canadian Natural Resources (TSX:CNQ) means it will now concentrate on its shale oil and gas properties in B.C. and Alberta, along with its refining and chemical businesses near Edmonton and its proposed West Coast LNG project.

He says Shell Canada will add about 20,000 barrels of oil equivalent per day this year to current Western Canada production of about 130,000 boe/d, with most of the new barrels coming from the Alberta Duvernay region.

In an interview, Crothers says the market for liquefied natural gas appears to be improving, but there’s still no timeline for an investment decision on the Kitimat, B.C.-based LNG Canada project it and its partners have proposed building.

He says the project isn’t affected by uncertainty over who will form the B.C. government following a near tie in the recent election because both the Liberals and NDP support it.

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