Husky Energy Inc. (TSX: HSE) is a large integrated energy company based in Calgary, Alberta, Canada in Western Canadian Place. Primarily focusing on petroleum and gas, Husky employs over 3800 people (as of 2006), almost $18 billion in assets, and produces an average of 369,900,000 barrels (58,810,000 m³) of oil equivalent per day (3rd quarter 2007), making it one of Canada’s largest energy companies. Aside from the Husky brand, Mohawk Gasoline is the next primary brand used. It conducts operations primarily in the United States, Canada, and China. A majority stake in Husky Energy is owned by Hong Kong billionaire Li Ka Shing and his holding company Hutchison Whampoa.
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Assets and holdings
Husky Energy has proven petroleum reserves of 430 million barrels (68,000,000 m³) and 2 trillion cubic feet (57 km³) of natural gas, most of it in western Canada. It owns approximately 500 filling stations in Canada and operates the Lloydminster Heavy Oil Upgrader. Husky holds property and/or mineral rights to some 6.67 million acres (27,000 km²) in western Canada.
The corporation also owns some 425,000 acres (1,720 km²) in the Athabasca, Peace River, and Cold Lake regions of western Canada, which the company claims hold some 33 billion barrels (5,200,000,000 m³) of bitumen.
Husky holds extensive offshore properties. It is the operator of the White Rose project and partner in the Terra Nova project in the Jeanne d’Arc Basin off Newfoundland The company also owns a 40% interest in the Wenchang project, which expects to derive as much as 92 million barrels (14,600,000 m³) of oil from a field located near the mouth of the Pearl River. The remaining sixty percent of the project is owned by the Chinese National Offshore Oil Corporation (CNOOC). Interests have also been acquired in two fields located off the coast of Madura, Indonesia.
In terms of refined products facilities, Husky owns and operates a light oil refinery at Prince George, British Columbia; an asphalt refinery at Lloydminster, Alberta/Saskatchewan; an ethanol plant at Lloydminster; and another at Minnedosa, Manitoba.
A substantial portion of Husky’s property and operations base comes from its acquisition of Renaissance Energy. In 2003 it also purchased the Canadian unit of the American-based Marathon Oil Corporation.
Operations
Husky Energy’s operations are divided into three categories: Upstream, Midstream, and Refined Products.
The Upstream division focuses on oil and gas exploration and extraction. The division’s primary projects include mineral extraction from oil sands, and offshore drilling at the White Rose and Wenchang sites.
Because some 80% of Alberta’s oil sands are too far below the surface for standard mining and drilling precedures to access, Husky plans to use “steam assisted gravity drainage technology”, by which bitumen will be raised to closer to the surface through high temperatures. After the bitumen is recovered, it will be subjected to a process by which useful oil will be extracted. The company’s Tucker Thermal Project is expected to begin producing in late 2006 and over 35 years it is estimated it will recover some 352 million barrels (56,000,000 m³) of bitumen. A second endeavor, the Sunrise Thermal Project, may produce 3.2 billion barrels (510,000,000 m³).
Costing 2.35 billion Canadian dollars and starting operation in November 2005, the White Rose project (located off Newfoundland) is anticipated to recover over 600 million barrels (95,000,000 m³) of oil. Another offshore project, Wenchang, located off China’s Pearl River and run jointly with the CNOOC produced an average of 16 million barrels per day (2,500,000 m³/d) in 2005.
Husky’s Midstream division engages in activities such as oil upgrading, pipeline systems, commodity marketing, electricity cogeneration, oil and gas storage, and processing.
Currently, Husky markets about 300 million barrels (48,000,000 m³) of oil per day and uses another 145 million barrels (23,100,000 m³) in refining and processing. A total of 500 million barrels per day (79,000,000 m³/d) are managed overall. The company manages 1.8 billion cubic feet (51,000,000 m³) per day of natural gas and transports it along sixteen pipelines.
Husky Energy uses ethanol instead of MTBE in their gasoline products.
Corporate governance
Current members of the board of directors of Husky Energy are: Canning Fok, Donald Fullerton, Martin Glynn, Terence Hui, Brent Kinney, Holger Kluge, Poh Chan Koh, Eva Kwok, Stanley Kwok, John Lau, Victor Li, Wayne Shaw, William Shurniak, and Frank Sixt.
Tommy Douglas served as a director of Husky Oil after his retirement from politics.
