May 4, 2011 / 2:19 PM / 9 years ago

UPDATE 2-Shell's Scotford upgrader expansion on stream

* Scotford upgrader expansion complete

* Boosts capacity by 100,000 bpd to 255,000 bpd (Adds details)

CALGARY, Alberta, May 4 (Reuters) - Royal Dutch Shell Plc (RDSa.L) said on Wednesday work on a 100,000 barrel per day expansion of its Scotford oil sands upgrader in northern Alberta is complete and the facility has started producing synthetic oil.

The expansion brings the capacity of the upgrader to 255,000 bpd and is the final phase of an expansion of the company’s 60 percent owned Athabasca Oil Sands Project.

Shell is feeding the new upgrader, located near Edmonton, with production from its Jackpine mine in the Athabasca oil sands north of Fort McMurray, Alberta. The mine, one of two attached to the project, opened in September.

The company expects to further expand the capacity of the upgrader, which converts tarry bitumen into refinery-ready synthetic crude, through a series of tweaks to the facility that could boost output by a further 85,000 bpd.

Shell operates the tar sands mining and upgrading project, and Chevron Corp (CVX.N) and Marathon Oil Corp (MRO.N) each have a 20 percent interest in it. (Reporting by Scott Haggett; editing by Peter Galloway)

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