Canadian oil sands "wildly profitable"

Think Saudi Arabia has a lock on oil? Turns out Canada has almost as much crude, if not more. For years Canada has pumped oil from traditional wells, shipping it across the border to U.S. consumers. In fact, Canada is the top oil exporter to the United States. (Saudi Arabia ranks third after Mexico.)

With crude prices hanging so high, Canada's unconventional oil sands - or tar sands, as they're often called - have become wildly profitable, adding more than 170 billion barrels of oil to Canada's reserve base. Today, the sands produce as much oil as Texas - about 1 million barrels a day. Output is set to nearly triple during the next 10 years. This will feed Americans' voracious appetite for oil far into the future, but the promise is not without problems.

Extracting valuable crude oil from sand is labor-intensive and expensive. And the process, which involves leveling acres of evergreens and spewing greenhouse gases into the air, has riled environmentalists. Still, energy companies such as Shell, Suncor, Exxon Mobil and ConocoPhillips press on. As Bob Gibson, managing director of independent investment bank Mustang Capital Partners of Calgary, points out: "All the issues get diluted at $60 oil." ...

(2005-11-07 13:06:22 SGT) [Energy] Permalink

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