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Husky Energy to spend $4.7-billion on Sunrise and other projects

Husky Energy chief executive officer Asim Ghosh said the company remains 'focused on execution.'

Todd Korol/Reuters/Todd Korol/Reuters

Husky Energy Inc. said Thursday it plans to spend $4.7-billion in 2012, with large chunks of that capital going toward its Sunrise oil sands project, its operations in southeast Asia and bread-and-butter oil and gas holdings in Western Canada.

The Calgary-based energy company plans to spend $610-million on Sunrise, part of a joint-venture with British oil giant BP PLC, as construction ramps up and its 2014 targeted startup date approaches. The first phase of Sunrise will produce 60,000 barrels a day and is expected to cost $2.5-billion.

Just over $1-billion is earmarked for Husky's Southeast Asia operations, with its Liwan field set to start production in 2013 or 2014. Deep water and shallow water facilities are being built on that property in the South China Sea.

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Husky is also looking "reinvigorate and transform" its foundation in Western Canada, with $1-billion in capital expenditures planned for the Western Canadian sedimentary basin.

"Our business strategy is on course and demonstrating its ability to deliver value to shareholders," chief executive officer Asim Ghosh said in a statement.

"Our 2012 program will build on that progress as we remain focused on execution."

Husky plans to keep its growth at 3 to 5 per cent every year over the next three years.

It said it expects this year's production to come in near the high end of its guidance around 312,000 barrels of oil equivalent a day.

Next year, production is projected to be 290,000 to 315,000 barrels a day, as work scheduled to be done on its offshore East Coast platforms will cut output.

Husky, controlled by Hong Kong billionaire Li Ka-Shing, produces oil and gas in Western Canada, off Canada's east coast and in Southeast Asia.

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Husky also has interests in BP-operated refineries in the United States, and a chain of Husky-branded fuel retail outlets in Canada.

Husky had contemplated spinning off its Southeast Asian properties into a new publicly traded company, but ultimately decided late last year to keep the high-growth assets in its portfolio.

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