Wednesday, August 11, 2010

Canadian Oil Sands - Top Crude Oil Source

By Andrea:

A recent study from Cambridge Energy Research Associates (CERA) predicted that Canadian oil Sands will most likely become the number 1 source of U.S. Crude oil import this year. The study concluded that by 2030, oil sands could represent 36% of oil imports. Compare this against an actualy 8% in 2009, that is a huge growth and may be something to keep an eye on. In 2009, oil sands produced 1.35 million barrels per day, this study predicts that the rate could rise to between 3.1 mbd and 5.7 mbd by 2030.

While this sounds promising by the numbers, every good thing has its price. There is currently a lot of controversy around the production of oil sands. Greenhouse gas emissions from oil sands are about 5-15% higher than the average crude oil produced in the U.S., however; the report says that with the advancement of technology in oil sand production, there is a continuous improvement in the progress of cutting greenhouse gas emission and reducing its environmental impact.

Despite some opposition, the benefits of Canadian oil sands could prove to be a strong positive force in the U.S. economy:

“The fact that oil sands by themselves—were they a country—are set to become the largest single source of U.S. crude oil imports this year, emphasizes the importance they have attained as a supply source for the United States,” said IHS CERA chairman Daniel Yergin, author of the groundbreaking history of oil, The Prize.

Oil sands also contribute to U.S. energy security, the report says, because Canadian oil is “less foreign” than imports from other countries. “By most measures Canada’s oil is less foreign than other potential sources of supply,” the report says. “Oil supply from Canada is stable, proximate, connected by pipelines, and part of a limited set of oil development opportunities in which private oil companies—including US firms—can openly and securely invest.”

Companies currently exploring oil sands include:

Suncor Energy Inc. (SU)
Chevron Corporation (CVX)
Royal Dutch Shell
Devon Energy Corp. (DVN)

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