Due to the rising cost of oil the tar sands in Canada are now considered a go and have been included in the lastest estimates. These estimates raised Canada's 4.9 billion barrels of oil to 175 billion barrels of oil. Compare that to Iraqs 112 and Saudi Arabia's 264.
However, there are some things that can throw a wrench into this. One is the price per barrel of oil. For this year we are likely to see no lower than $50 per barrel. At this price this is still viable. However, when oil starts to drop more steadily, this process will be too expensive. Plus we will not see a ramping up of production over night, it will take several years and to expect oil to remain that high for that long is not reasonable. Grabbing the oil from the sands puts more carbon monoxide out there and remember that Canada signed onto Kyoto. This could have a big impact on the price per barrel of oil coming out of Canada. 20 to 40 cents now is not that big of a deal but what happens several years from now if oil is selling at $30 a barrel? There will come a point where the market will not absorb the additional cost.
Related links:
Spearhead delivers oil sands crude to Cushing "Enbridge Inc. delivered the first crude from oil sands in western Canada to Cushing, Okla., through its Spearhead Pipeline on Mar. 2."
Chevron Buys Oil Sands Leases in Canada "Chevron Corp. said Thursday it plans to develop a giant oil sands project in northern Canada, the latest in a string of investments that is quickly turning the region around Ft. McMurray, Alberta, into one of the world's fastest growing oil-producing regions."
International rig count rose last month Excludes rigs in Sudan and Iran. Canadian and US rig count up.
Canada's oil supply could top Saudi Arabia: report Within 10 years. I disagree with their assertion that oil will be, on average, $70 US per barrel this year.
Canada To Compete In Oil Market
Canadian Energy
