The Houston-based oil company, the third-largest in the United States, said it will ramp up bitumen production from 60,000 b/d this year to one million, net to ConocoPhillips, in the next two decades, from projects already underway with partners EnCana Corp., Total SA and others, and from three large leases it owns outright that it plans to develop on its own.
The move marks the biggest commitment yet to the deposits by a U.S. company.
"We believe that the oilsands ... have to come to market for energy-security reasons and to meet demand," Matt Fox, senior vice-president, oilsands, said in an interview, after the company announced first oil production from its Surmont thermal project, which it owns with Total.
"That's why we have taken such a significant strategic position in the oilsands. We think it's going to be one of the key areas of growth from unconventional production."
ConocoPhillips' target is the most aggressive yet in the business, surpassing that of competitors such as Royal Dutch Shell PLC, Suncor Energy Inc. and Canadian Natural Resources Ltd.
U.S. peers such as ExxonMobil Corp. and Chevron Corp. have been less enthusiastic about the deposits, focusing instead on projects in other areas of the world.
ConocoPhillips revealed its big oilsands ambitions a week after long-time oilsands skeptic BP PLC, a British oil major, bought a toehold into the business through a joint venture with Husky Energy Inc.
Mr. Fox said royalty increases announced by the Alberta government in October hurt the oilsands, but ConocoPhillips can temper the hit through technology.
"We think that the oilsands are ripe for technology advances," he said. "We are spending about $500-million over the next five years on technology focused specifically on heavy oil, to improve recovery processes, improving the thermal efficiency and to reducing the environmental footprint and looking at alternative fuels."