Reliance Industries Ltd (RIL) has submitted a $2 billion expression of interest (EoI) for private Canadian oil sands firm Value Creation Inc (VCI), business news channel CNBC TV18 reported today.
VCI owns one of the largest holdings of oil sands properties in Canada. Its leases cover over 110,000 hectares. The company also owns proprietary upgrading technologies that are expected to provide the lowest cost upgrading of bitumen to refinery-ready light crudes.
|Terre de Grace Project will be the first bitumen production project developed by VCI |
In March 2008, Value Creation acquired BA Energy, making it a wholly owned subsidiary. BA Energy spearheaded the first commercial application of the Value Creation Group technology with its Heartland Upgrader, currently being constructed in Strathcona County, northeast of Edmonton, Alberta.
VCG technology uses a combination of processes to produce a synthetic crude oil that, although sour, has the difficult sulphur compounds removed, leaving only sulphur components that can be readily desulphurised by hydrotreaters or hydrocrackers already available in most existing conventional refineries.
The technology of the Value Creation Group (VCG) is designed to significantly lower oil sands production, transportation and bitumen upgrading costs that currently inhibit higher production from the Alberta oil sands.
VCI also plans to apply its breakthrough technology and synergistic integration with Steam Assisted Gravity Drainage (SAGD) to develop its extensive oil sands leases, commencing with its first development project at Terre de Grace near Fort McMurray, Alberta.
VCI has a pilot project at Terre de Grace, 23 km northwest of Fort McKay, 28km southeast of Namur Lake and 80 km northwest of Fort McMurray.
Reliance, India's largest listed company, operates one of the most up-to-date refineries in the world capable of processing almost all kinds of crude. RIL also looking to acquire bankrupt petrochemicals maker LyondellBasell for around $13.5 billion.