CBC News reported that increasing costs have not deterred ExxonMobil (NYSE:XOM) and its partners from moving forward with the Newfoundland-based Hebron oil project. They plan to begin construction and fabrication of the Hebron platform and expect first oil to be reached at the end of 2017.
As quoted in the market news:
“Project sanction marks a significant milestone for the Hebron project,” Geoff Parker, Hebron’s senior project manager and vice president of ExxonMobil Canada Properties, said in a release Friday.
The sanction decision comes despite ballooning costs of billions more than estimates from less than two years ago.
In 2011, ExxonMobil indicated that it would cost $8.3 billion to build Hebron, plus another $5.8 billion to operate it until the oil runs out in three decades. Total: just over $14 billion.
On Friday, the oil giant said capital costs alone now account for $14 billion.
Company officials told CBC News there are some additional capital costs thrown into the mix, related to tying a separate pool of oil back to the Hebron platform. They could not break out those specific numbers.