Jan.9, 2020 Prosper Petroleum Ltd. Press Release

PRESS RELEASE – Prosper Petroleum Ltd., a privately held, 95% Alberta owned company has filed documents in the Court of Queen’s Bench of Alberta for an order directing the Government of Alberta to make a decision regarding Prosper’s Rigel Oil Sands Project.

The Rigel project is a 10,000 bbl/day steam assisted gravity drainage bitumen recovery project located approximately 70 km NW of Fort McMurry, AB. It proposes to use commercially proven in-situ technologies to produce bitumen over a period of approximately 24 years. The project will have a compact design and small footprint relative to other similarly sized oil sands projects. Through the project design and regulatory process, the company proposed various mitigation measures to address potential effects on the environment and potentially affected Aboriginal groups.

Prosper applied for the Rigel Project in November, 2013, and since then has met all applicable regulatory requirements to proceed, including a two week Alberta Energy Regulator hearing held in January, 2018. The AER made a decision on the project in June, 2018, concluding the project is in the public interest of Alberta and recommending the Alberta Government issue an Order in Council for the project, yet in January, 2020 – after spending approximately $65 million and over six years – Prosper still has not received an Order in Council. This means that Prosper has no certainty that the Project will proceed, and worse still, it may not proceed by reason of the inordinate and unprecedented delay caused by our Provincial Cabinet. Prosper has repeatedly requested the government issue an Order in Council or explain to the company why the approval is not being issued. Prosper has not received a reply to its requests, and in the meantime the government has issued Orders in Council for other projects that were applied-for after Rigel.

The economic benefits expected from the project will be substantial, particularly in terms of royalties to Alberta ($1 billion), taxes to all levels of government ($15 million to the municipal government and $530 million to provincial and federal governments), and employment income ($195 million during construction and $20 million annually during operations). The AER found that the benefits of the project will outweigh any impacts; however, none of these benefits will be realized unless and until the government issues an Order in Council.

The delays are costing the company dearly. To date, the company has spent approximately $65 million on the approval process. Delays to the project are costing approximately $133,000 per day in lost revenues. It is also costing Albertans and Canadians. Using a Statistics Canada model, the Canadian Association of Petroleum Producers estimates the project would add 10,812 full-time equivalent jobs during the construction phase, create 1,603 permanent jobs, and boost the GDP by $665 million. The unprecedented delay caused by the Alberta Government is impairing Prosper’s ability to effectively operate its business, is putting jobs for Albertans at risk, and risks jeopardizing the viability of a project that the provincial regulator has already concluded is in the public interest of all Albertans.