Canada could have an answer to U.S. oil woes

Globe and Mail Update ^ | Friday, September 28 | MATHEW INGRAM

[aculeus]

Why does the United States have to tiptoe so carefully in the Middle East, trying to play one country off against another, careful not to upset certain countries? Why does it even have to get involved in Middle Eastern politics in the first place? One word: Oil. Without the supply of oil that countries such as Kuwait, Iraq, Saudi Arabia, Iran and others produce, the United States would be in deep trouble. And so, the U.S. government repeatedly finds itself drawn into a volatile morass of shifting allegiances.

Is there any long-term solution? Environmental activists have recommended for some time that the United States pour billions into alternative energy such as wind power, biomass and fuel cells - but there is no way these technologies could handle a fraction of the current demand for energy from fossil fuels, let alone the growth projected for the coming decades. But where else could the U.S. come up with the oil to satisfy its needs?

The U.S. government itself mentioned one possible solution in Vice-President Dick Cheney's recent energy report: Alberta's oil sands, a vast ocean of tar-like goo in the northern part of the province. By most estimates, there is more oil in the so-called "tar sands" than there is in all of Saudi Arabia, or about 300 billion barrels that is recoverable using existing technology. That's enough to supply the United States for more than 40 years — plus there's another 1.5 trillion to two trillion barrels on top of that, which would be harder to extract. That's 10 times what Saudi Arabia has.

Alberta's potential was obvious even before Sept. 11, and those attacks have now added even more fuel to the argument. What if Iraq turns out to be involved in planning the attacks? Even worse, what if Saudi-born terrorist Osama bin Laden decides to turn his wrath against the Saudi royal family, whom he despises for allowing U.S. troops to be stationed in the traditional birthplace of Islam? Saudi Arabia has about one quarter of the world's reserves of conventional oil, and last year it supplied the U.S. with 1.5 million barrels a day, or about 17 per cent of U.S. demand. Almost one-quarter of U.S. demand for oil is supplied by countries in the Persian Gulf.

One of the reasons why the oil sands haven't played a larger role on the public policy stage is that until fairly recently, getting oil out of the ground in northern Alberta was time-consuming and expensive. Until the mid-1990s, producing a barrel of oil cost upwards of $15 (U.S.). That didn't leave much room for things like profits when the price of oil was at $20 — and it seemed especially ridiculous given that some OPEC countries can produce a barrel of oil for about $5 or less.

Then Suncor Energy, thanks to prodding by vice-president Dee Parkinson, cut a huge chunk out of its costs starting in 1995 by moving from the balky and expensive bucketwheels it had been using to giant shovels and trucks. Suncor and Syncrude (which copied the move) have cut their costs to $9 a barrel — and that success, combined with the runup in oil prices over the past couple of years, has spurred dozens of imitators to look at oil-sands projects. Conoco, Exxon-Mobil, Shell and other companies both in the United States and elsewhere have done feasibility studies, and more than $20-billion worth of potential oil sands projects are in the planning stages.

There are also dozens of projects aimed at exploring ways of extracting some of the harder-to-reach oil. The current method is not very different from the Clark hot-water process, which was discovered in the 1920s — and that itself was a refinement of the way early explorers boiled the gooey substance in water over the campfire to produce a tar they could patch their canoes with. Newer methods for extracting the oil involve things such as "steam-assisted gravity drainage," which involves injecting steam into the sand and then forcing the oil to drain out for refining.

In the 1930s, the U.S. government and several business leaders (including Henry Ford) reportedly looked into extracting oil from Alberta to help meet the growing demand in the United States. But then oil was discovered in Saudi Arabia, and the seeds of OPEC and the energy dominance of the Middle East were sown — something the United States may want to reconsider in the light of current events. And then maybe Canada could take the place of Saudi Arabia in the American universe.

[JulieRNR21]

FYI....I'll wager you can enlighten us all about this proposal.

[TheLurkerX]

the Canadians also have a way of separating oil electrostatically now that allows you to take out oil from "dry" wells, and return soil to the ground that you can plant in. The oil is almost as pure as that pumped out of the ground by standard means. They have prototypes running, but have met a lot of resistance from American oil companies. As soon as our environmental laws catch up, they hope to license the technique to smaller oil producers in this country. They estimate enough oil left in already drilled and abandoned wells to last long into the future.

[MinuteGal]

Sounds good to me! But out of the communes would rush the "Canadian Capers" (Canadians Against Pollution , Energy and Rightist Swindlers).

Leni

[aculeus]

It's an old old story. Got several billion dollars in spare change? Then you can convert oil sands to oil.

We have similar deposits in the USA. Oil in great quantity but locked into clay or sand and difficult to extract.

[bmwcyle]

We should have stop their bomb building years ago. Iran and Iraq are too close to big bombs.

[TheLurkerX]

That's what the electrostatic method is supposed to extract relatively easily. The way I understand it though, they are prevented from setting up production with it in this country by the current environmental laws. I'll see if I can find the story I read about it a couple of months ago.

[MHGinTN]

It is time, in fact well past time, to squelch the criminal enterprise democrats and make this nation oil self-sufficient. Combine that with focus of our science on becoming energy self-sufficient as the oil reserves decline and we will have removed one of the biggest obstacles to thumbing our nose at self absorbed oil sheiks and their lies and secret terrorist support. I would like to ask fools like Leahy and Daschle what damn good environmental relativism will be when this nation ceases to function as a global power because of being dictated to by the Middle Eastern oil bullies and OPEC socialism? They wouldn't answer of course.

[Capt Phoenix]

Unfortunately Canada also has something else. Something that Saudi Arabia doesn't have: evironmentalists. An even more radical and fervent (though perhaps less violent) crowd than the US. And the violence deficiency would be quickly made up by the radical WTO "flying terrorist columns".
That means your costs of extraction have to include both the massive, burdensome, and mostly counter-productive regulations that the Greens will force the legislature to pass, but also the costs of eco-terrorism and "protests". Blocked trucks, sabotaged equipment, month-long "sit-ins" (like they do in the trees to stop lumbering), and blown-up pipelines (the damage then blamed on you for your "lax security"), are only the beginnings. Add lawsuits by every left-leaning American lawyer seeking to make a name for himself (we have over half the worlds supply of lawyers).
I would dearly love to see Canada develope it's energy reserves, but I fear the enviros have that stopped before it's begun. Good luck, though! You have my best wishes!

[JulieRNR21]

Looks like an idea whose time has come! Thanks for this informative post.

[Vigilanteman]

There are no "comparable deposits" in the United States to Alberta's vast resources of tar sands. The closest thing are low grade coal deposits in the Dakotas and Montana and oil shale deposits on the eastern rim of the Rockies. Extraction technologies for both are far higher than for tar sands.

The one-two punch of developing tar sand extraction and fuel cell technology could give a knock-blow to the oil dictators of the world. So could military seizure of most strategic oil fields, which tend to be located in limited areas around the Gulf.

[goodnesswins]

"Unfortunately Canada also has something else. Something that Saudi Arabia doesn't have: evironmentalists."

You're right about the environmentalists, BUT I don't think Alberta has quite as many....they've seen CAPITALISM and HOW IT WORKS!!!!!! (And, I would bet they are the most self sufficient of all of Canada's provinces.)

[Kermit]

"And then maybe Canada could take the place of Saudi Arabia in the American universe. "

This could be a whole new nightmare.;^)

[manx]

OH NO!!! Does this mean the Canadians are going to start wearing towels around their heads and yelling, "DEATH TO AMERICA!!!!"??

[Blood of Tyrants]

Until the mid-1990s, producing a barrel of oil cost upwards of $15 (U.S.). That didn't leave much room for things like profits when the price of oil was at $20 — and it seemed especially ridiculous given that some OPEC countries can produce a barrel of oil for about $5 or less.

Profit over principle and peace is why big oil still hasn't told Saudi Arabia, Kuwait, and the rest to pound sand.

[Nogbad]

OH NO!!! Does this mean the Canadians are going to start wearing towels around their heads and yelling, "DEATH TO AMERICA!!!!"??

Many of them already do.

(We'll actually no, they haven't yet put on the towels. But they're getting them ready.)

[xm177e2]

We should give ANWR to another country. Then we wouldn't feel so guilty about taking oil from it =)

[Clive]

FYI:

BDK: Chemistry 207: Tar sands

[CSSAlabama]

Cute! Another idea is while we are disposing of Saddam, we should take his oil fields and occupy Basra. This would fly with the PC clowns, as we would be doing this for two reasons:
A.) To guaranty a stable oil supply to the West B.) To exact "repararations" from a terrorist harboring state. (Reparations are chic now)
With the Iraqi oil fields we would get all the $5.oo/bbl oil we need for our domestic production and still sell it "Cheaply" to the EU, Japan, etc for a tidy profit to help pay for all our losses caused by 30 years of terrorist attacks, and some punitive damages as well. When we are satisfied that the damages have been satisfied, we can give them back their oil fields, if there is any oil left they can go back to their miserable lives.

[Free the USA]

Interesting