LATEST NEWS 
July 27, 2006
Resource company keeps lid on costs while doubling workforce
CALGARY
Canadian Natural Resources Ltd. is keeping a lid on costs on its Horizon Oil Sands Project in northern Alberta and expects to more than double the workforce over the next year as it ramps up the massive development.
In a periodic review of Horizon, the big energy producer said it is building parts of the project with its own mine equipment instead of using contractors in a bid to keep costs down. As well, the company is making parts for the oilsands development more cheaply using modular building in Edmonton and elsewhere. Canadian Natural is also flying skilled workers in weekly from Quebec, New Brunswick and Newfoundland to meet labour shortages and using a mix of union and non-union labour on the site.
In addition, Canadian Natural expects to have between 5,000 and 6,000 workers on the project by mid-2007, compared with about 2,500 today.
“Our emphasis on front end engineering coupled with a well defined execution strategy continues to deliver, allowing our project team the capability to execute in a resource-constrained environment,” said Real Doucet, senior vice-president of oilsands. “The Horizon Project achieved significant construction milestones, while achieving excellent safety performance.”
Doucet added that while it is still early in the project, the company has found the efficiency of its workers and contractors has been as good as or better than expected.
“Some of this is due to favourable weather conditions as well as contractors generating more efficient construction methods under their lump-sum bids and the completion of more modular work in the Edmonton region,’’ he said.
With about $4.4 billion in awarded contracts and a budgeted $900 million for internal costs, Canadian Natural said it already has a high degree of cost certainty on $5.3 billion of Phase 1 construction costs.
In addition, the company said all major plants on the project have been passed through hazard-operability reviews without requiring major changes, providing even greater cost certainty.
CANADIAN PRESS
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