REFILE-Imperial Oil says started production at Kearl oil sands project

Sat Apr 27, 2013 4:07pm EDT

April 27 (Reuters) - Imperial Oil Ltd on Saturday said production is underway at its Kearl oil sands project in eastern Alberta, five months after the original target date for the company's biggest undertaking yet.

Imperial, majority owned by Exxon Mobil Corp and Canada's No. 2 oil producer and refiner, said it is now producing mined diluted bitumen at the first of three froth treatment trains at the project that is expected to produce 110,000 barrels of heavy oil sands crude per day by the end of the year.

Production at Kearl was initially due to start in December before court challenges in the U.S. Pacific Northwest stalled the transport of foreign-made processor modules to the site.

The Kearl project is the "beginning of a period of substantial growth for the company that will see us double production to more than 600,000 barrels per day by about 2020," Rich Kruger, Imperial Oil chairman and chief executive officer, said in a release.

Still, it could be weeks before oil from Kearl hits Canadian markets as Imperial must first fill storage tanks and a pipeline to the facility, a process that analysts have said could take as long as three months.

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