
Husky
Energy
Husky
Energy Inc. (Husky) is a Canadian-based energy and energy-related
company headquartered in Calgary, Alberta. Husky operates
in Western Canada, offshore the East Coast of Canada and holds
interests in the South and East China Seas, and Indonesia.
Husky employs more than 4,000 people and has a market value
of approximately CDN $38 billion.
Husky commenced trading on The Toronto Stock Exchange under
the symbol HSE, on 28 August 2000 and is included in the S&P/TSX
Composite, S&P/TSX Canadian Energy Sector, and S&P/
TSX 60 indices.
Operations
Husky's operations can be divided into three distinct business
segments:
Upstream
Upstream includes the exploration, development and production
of crude oil, bitumen and natural gas in Western Canada, offshore
the Canadian East Coast, in the South and East China Seas,
offshore Indonesia and other international areas. The Western
Canadian assets contribute the majority of the Company's earnings
and cash flow, providing a strong base to fund Husky's long-term
development projects.
Midstream
Midstream operations include the upgrading of heavy crude
oil into premium synthetic crude oil, pipeline transportation,
gas storage, cogeneration, and the marketing of crude oil,
natural gas liquids, sulphur and petroleum coke. Significant
assets include the Lloydminster heavy oil upgrader with a
processing capacity of 82,000 barrels per day, a 2,050-kilometre
pipeline system, a 50 per cent interest in a 215-megawatt
cogeneration facility at Lloydminster and a 90-megawatt power
generation facility at Rainbow Lake, Alberta, gas storage
capacity, treating and gathering systems, and commodity marketing.
Downstream
Downstream comprises the refining, marketing and distribution
of gasoline, diesel, asphalt, ethanol and ancillary services
in Canada and the United States, and a network of retail outlets.
Core assets include the Lima refinery, the Lloydminster asphalt
refinery, the Prince George light oil refinery and a network
of over 500 retail outlets from the provinces of British Columbia
to Ontario and to the Yukon Territory.

Upstream Operations
Western Canada Conventional Production
Husky has oil and gas leases on approximately 7.5 million
acres in Western Canada, with plenty of opportunity for new
reserve additions from exploration and development.
Heavy Oil
Husky has been a pioneer in the development and production
of heavy oil and remains Canada's dominant player. The Company's
position is enhanced by synergies with its nearby heavy oil
upgrader and asphalt refinery, and leases on 1,100,000 acres
of undeveloped and 415,000 acres of developed landholdings.
Oil Sands
The oil sands of northern Alberta are one of Husky's long-term
growth areas. The Company has nearly 511,000 acres in the
Athabasca, Cold Lake and Peace River areas that contain over
40.9 billion barrels of bitumen in place.
Husky's first two oil sands projects are at Tucker and Sunrise.
Construction on the Tucker Oil Sands Project was completed
in August 2006, and achieved first oil at the end of 2006.
The Tucker Project, is estimated to have a 35 years project
life and peak production of more than 30,000 barrels per day.
Regulatory approval to develop the Sunrise Oil Sands Project
was received in December 2005. Husky estimates that the Sunrise
Project could produce 3.2 billion barrels of bitumen over
a 40 years life.
Canada's
East Coast
Husky is very active in oil and natural gas production and
exploration in the Grand Banks, offshore the coast of the
province of Newfoundland and Labrador. The Company is the
majority owner (72.5 per cent) and operator of the White Rose
oil field and has a 12.51 per cent interest in the Terra Nova
oil field, as well as in a number of smaller fields in the
central part of the Jeanne d'Arc Basin. Husky holds working
interests in 15 significant discovery areas in the Basin.
International
Husky's first venture in China was the 2002 acquisition of
a 40 percent interest in the Wenchang oil fields located in
the western Pearl River Mouth Basin, approximately 300 kilometres
south of Hong Kong and 135 kilometres east of Hainan Island.
Husky's total acreage in the South and East China Seas has
grown to over 5.4 million acres.
In June 2006 Husky Energy reported a significant hydrocarbon
discovery at Liwan 3-1-1, in Block 29/26, in the South China
Sea. The Liwan 3-1-1 well will be sidetracked for further
evaluation of the pay zone and Husky completed a 3-D seismic
survey to assess a number of similar structures which were
identified on 2-D seismic data. A deep water drilling rig
has been secured for a three year term with delivery expected
in mid-2008. Based on our current interpretation of the 2-D
seismic and the Liwan 3-1-1 well results, the discovery could
contain a potential recoverable resource of four to six trillion
cubic feet of natural gas and as such, would be one of the
largest natural gas discoveries offshore China.
Husky's Madura Strait block is located in the East Java Sea
about 40 kilometres northeast of the island of Java and covers
an area of 2,794 square kilometres. Husky's production sharing
contract in the Madura Strait offers great potential, as it
contains the BD and the MDA gas fields along with additional
exploration prospects. In June 2006, Husky acquired the East
Bawean II Block in the East Java Sea. Husky holds a 100% interest
of both blocks and the acquisition of the East Bawean ll Block
increases Husky’s total holdings in Indonesia to 7,049
square kilometres or approximately 1.8 million acres.

Midstream Operations
Upgrading
Husky owns and operates a heavy oil upgrading facility at
Lloydminster, Saskatchewan which processes heavy oil feedstock
into premium quality synthetic crude oil. The Upgrader achieves
a very high yield of light synthetic as it uses both coking
and hydrocracking. The Upgrader processes the heavy oil into
light (32-34o API), sweet (0.1 per cent sulphur
versus conventional light at 0.3 to 0.5 per cent) and low-nitrogen
(0.04 per cent) synthetic crude oil, which can be further
refined into premium-quality transportation fuels
The Upgrader has achieved throughput capacity of 82,000 barrels
of synthetic crude oil per day following the completion of
debottlenecking projects in 2007.
Infrastructure
An important component of Husky's heavy oil operations in
Lloydminster is its 2,050-kilometre heavy oil pipeline system.
As part of its operations, the Company owns, operates and
leases natural gas storage capacity, and has a 50 per cent
ownership interest in an electricity cogeneration facilities
at its Lloydminster heavy oil upgrader and Rainbow Lake natural
gas processing plant.
Commodity Marketing and Storage
Husky is a major marketer of both its own and third-party
production volumes of crude oil, natural gas, natural gas
liquids, sulphur, and petroleum coke. Husky sells natural
gas to a large variety of end users across North America,
and manages transportation on behalf of third parties.

Downstream Operations
Wholesale,
Commercial and Retail Marketing
Husky and Mohawk-branded fuels are marketed through more than
500 retail outlets, travel centres and bulk distributors located
in the Canadian provinces of British Columba, Alberta, Saskatchewan,
Manitoba and Ontario, and Yukon Territory.
Oil Refining and Ethanol Processing
In 2007, Husky completed the purchase of a 165,000 barrel
per day light oil refinery based in Lima, Ohio for USD1.9
billion plus working capital. Options are being examined to
convert the refinery to process heavier feed stocks.
The light oil refinery at Prince George, British Columbia
produces all grades of unleaded gasoline, seasonal diesel
fuels, a propane and butane mix, and heavy fuel oil. Following
the completion of the Clean Fuels Project in 2006, refinery
throughput increased from 10,000 to 12,000 barrels per day.
Husky plans to become Western Canada's largest producer of
ethanol for use in blending with fuel. Ethanol is an oxygenate,
derived from grain, that when added to gasoline promotes fuel
combustion, raises octane levels and prevents water from freezing
in fuel lines. The use of ethanol-blended gasoline reduces
emissions from vehicles and thus reducing greenhouse gas emissions.
The Company completed its 130 million litres of ethanol per
year at Lloydminster, Saskatchewan in June 2006 and a 130-million
litre per year facility at Minnedosa, Manitoba at the end
of 2007.
Asphalt Refinery and Marketing
Husky
owns and operates a 27,000 barrel per day refinery at Lloydminster
that processes heavy oil into asphalt, used for paving and
building products. The high quality of the asphalt produced
at the Lloydminster refinery has allowed Husky to achieve
a 35 per cent market share in the western Canadian paving
market. 40 per cent of the refinery production is exported
to the United States, where demand for high specification
asphalt is growing.
Husky Energy Inc.
707-8th Avenue SW
Box 6525, Station "D"
Calgary, Alberta
Canada T2P 3G7
Telephone: (403) 298 6111
Fax: (403) 298 7464
Website: www.huskyenergy.ca

Copyright 2003 Hutchison
Whampoa Limited. All rights reserved.
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