(1) Includes bitumen wells.
North America, excluding Oil Sands Mining and Upgrading, accounted for approximately 69% of the total capital expenditures for the year ended December 31, 2012 compared with approximately 77% for the year ended December 31, 2011.
During the fourth quarter of 2012, the Company targeted 3 net natural gas wells, including 1 well in Northeast British Columbia and 2 wells in Northwest Alberta. The Company also targeted 313 net crude oil wells. The majority of these wells were concentrated in the Company's Northern Plains region where 226 primary heavy crude oil wells, 15 Pelican Lake heavy crude oil wells, 2 light crude oil wells and 38 bitumen (thermal oil) wells were drilled. Another 32 wells targeting light crude oil were drilled outside the Northern Plains region.
Overall Primrose thermal production for the fourth quarter of 2012 averaged approximately 121,000 bbl/d compared with approximately 78,000 bbl/d for the fourth quarter of 2011 and approximately 102,000 bbl/d for the third quarter of 2012. Production volumes were in line with expectations due to the cyclic nature of thermal production at Primrose. As part of the phased expansion of its in situ Oil Sands assets, the Company is continuing to develop its Primrose thermal projects. Additional pad drilling was completed and drilled on budget, with these wells coming on production in 2013.
The next planned phase of the Company's in situ Oil Sands assets expansion is the Kirby South Phase 1 Project. As at December 31, 2012, the overall project was 81% complete, drilling was completed on the fifth of seven pads, and first steam is targeted for late 2013. In 2012, the Company acquired approximately 49 sections (12,630 hectares) of additional Oil Sands rights immediately adjacent to the Kirby Project.
Development of the tertiary recovery conversion projects at Pelican Lake continued and 15 horizontal wells were drilled during the quarter. Pelican Lake production averaged approximately 36,000 bbl/d for the fourth quarter of 2012 compared with 40,000 bbl/d for the fourth quarter of 2011 and 41,000 bbl/d for the third quarter of 2012. The decrease in production in the fourth quarter of 2012 from the third quarter of 2012 was a result of facility constraints, which will be alleviated as a result of the completion of the new 20,000 bbl/d battery expansion targeted to be on stream in the second quarter of 2013. With this incremental capacity, both Woodenhouse and Pelican production volumes will no longer be restricted.
For the first quarter of 2013, the Company's overall planned drilling activity in North America is expected to be 265 net crude oil wells, 31 net bitumen wells and 15 net natural gas wells, excluding stratigraphic and service wells.
Oil Sands Mining and Upgrading
Phase 2/3 expansion activity in the fourth quarter of 2012 was focused on the field construction of the gas recovery unit, sulphur recovery unit, butane treatment unit, coker expansion, and extraction trains 3 and 4, along with engineering related to the hydrogen and hydrotreater units, vacuum distillation unit and distillation recovery unit.
In December 2011, the Banff FPSO and subsea infrastructure suffered storm damage. Operations at Banff/Kyle, with combined net production of approximately 3,500 bbl/d, were suspended. The FPSO and associated floating storage unit have subsequently been removed from the field and the FPSO is currently in dry dock for assessment of the damage and repair timeframe. The extent of the property damage, including associated costs, is not expected to be significant.
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