UPDATE 1-Imperial boosts cost of initial Kearl phase

* Rejigs construction plans for oil sands project

* First, 110,000 bpd phase to cost more

* Final output of project pegged at 345,000 bpd
(Adds details)

CALGARY, Alberta, Nov 1 (BestGrowthStock) – Imperial Oil Ltd
(IMO.TO: ) said on Monday it will spend more than the C$8 billion
($7.84 billion) budgeted for the first 110,000 barrel per day
phase of its Kearl oil sands project as it reconfigures plans
for the massive mining project, though it did not say by how
much the budget is rising.

Imperial said it has altered plans to build the project in
three 110,000 bpd phases, with total production of 330,000 bpd
by 2020.

Plans for the initial tranche, to be completed by late
2012, remain unchanged. However later phases will include a
stage that boosts operations to increase the final capacity of
the project to 345,000 bpd by 2020.

“Instead of executing the remainder of the project in two
distinct phases, we’re reconfiguring (future expansions), all
of which will bring us to the same end point,” said Pius
Rolheiser, a spokesman for the company. “We’ll have the initial
phase followed by debottlenecking and expansion.”

Rolheiser said the new plan would see Imperial spend more
during Kearl’s first phase to install facilities and equipment
needed for subsequent expansions.

While that will raise costs for phase one of the project,
Rolheiser said the total cost of all phases of the project, a
figure that has not been released, remains unchanged.

“We’re not talking about a cost overrun,” he said. “We’re
talking about a reconfiguration.”

Imperial will own 70 per cent of the Kearl project, while
its parent company, Exxon Mobil Corp (XOM.N: ), holds the
remaining stake. Imperial is 69.9 per cent owned by Exxon.
(Reporting by Scott Haggett; editing by Rob Wilson)

UPDATE 1-Imperial boosts cost of initial Kearl phase