Athabasca Oil to shut down Hangingstone SAGD oilsands project and cut staff

Athabasca Oil Corp. logo is seen in this undated handout photo. THE CANADIAN PRESS/HO, Athabasca Oil Corp. *MANDATORY CREDIT*

Athabasca Oil Corp. is suspending operations at its Hangingstone SAGD oilsands operation due to the drop in oil prices and the COVID-19 pandemic.

The company says it’s also reducing its corporate staff by 15 per cent

The suspension of Hangingstone involves shutting in the well pairs and halting steam injection to the reservoir as well as ensuring that the processing facility and pipelines can be restarted in the future.

Athabasca says the project has an operating break-even price of approximately US$37.50 per barrel for Western Canadian Select.

The company says it now expects to produce 30,000 to 31,500 barrel of oil equivalent per day this year, down by about 2,500 barrels related to the shut-in.

Hangingstone began construction in 2013 and was commissioned in 2015.

This report by The Canadian Press was first published April 3, 2020.

Companies in this story: (TSX:ATH)

The Canadian Press