Canada oil sands plans get revamped as oil falls

CALGARY, Alberta (Reuters) – Companies developing Canada’s oil sands, one of the world’s largest deposits of crude oil, said on Thursday they aim to cut spending on multibillion-dollar projects in response to tumbling oil prices and the financial meltdown.

Petro-Canada, operator of the proposed C$21 billion-plus ($17 billion-plus) Fort Hills project, said it may first sell raw bitumen from its Alberta mine and defer the upgrading plant that turns the crude into light synthetic oil. Its shares jumped 5 percent.

Suncor Energy Inc said it will slow near-term spending on its C$20.6 billion expansion, delaying completion of its own new upgrader by a year. It also cut its 2009 budget by a third.

The cuts are the latest to hit Canada’s energy sector, where fortunes have soured quickly as oil demand has dwindled, more than halving prices in a three-month span to current levels below $70 a barrel.

Reuters