Imperial Oil is moving forward with a $2.6 billion project north of Fort McMurray.
The Calgary-based company announced Tuesday, construction on the 75, 000 barrel per day Aspen project will start in the fourth quarter of 2018 – with first production expected by 2022.
Imperial says Aspen will include next-generation technology to improve economics and reduce emissions intensity and water use by up to 25 per cent.
"We do not take investment decisions lightly, particularly in these challenging times," said Rich Kruger, Imperial chairman, president and chief executive officer, in a release.
"This is the right technology at the right time to make a competitive investment. We have made the decision to proceed now because we believe this advanced technology will further the evolution of Imperial's oil sands business."
Aspen has an anticipated life-span of 30-years. More than $4 billion in direct federal and provincial tax revenues are expected to be generated during that time.
During peak construction, the project is expected to create around 700 jobs and more than 200 positions during operation.