By any measure, Alberta’s heavy oil and
oil sands resource is huge.
Western Canadian Crude Oil Forecast
(000’s barrels per day)
The province’s three major oil sands
areas cover 140,800 square kilometres,
an area the size of New Brunswick. Add
to that the conventional heavy oil zones
running along the Alberta/Saskatchewan
border, and that number climbs even
higher.
3,000
Actual Forecast
2,500
2,000
1,500
There are an estimated 1. 7 trillion to 2. 5
trillion barrels of oil in place,
representing one-third of the known oil
reserves in the world. Reserves
recoverable with today’s technology lie
in the 174-billion-barrel range,
comparative to those of Saudi Arabia.
Bitumen From
Oil Sands
Synthetic Crude Oil
From Oil Sands
Conventional Heavy
Conventional Light
1,000
500
0
1971 1974 1977 1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010
Synthetic crude and bitumen will drive future oil production growth in Western Canada
But unlike Saudi Arabia’s light to medium SOURCE: Canadian Association of Petroleum Producers
sweet crude oil, Alberta’s resource base is
more complicated. It consists largely of “All the net increase in oil production this mined in the deposit at three major
oil sands, a thick, viscous mixture of year is expected to come from operations. By 2010, that amount will
hydrocarbons called bitumen, combined unconventional sources,” he says, adding climb to 1. 2 million barrels per day as
with water, sand and clay. that the deepwater is still the dominant projects currently under construction
play for the multinationals. “We forecast come on stream, according to estimates
Finding ways of producing this bitumen Canadian oil sands will become the single from the Canadian Association of
has taken almost a century, but it is now biggest incremental global supply by 2010.” Petroleum Producers. By 2015, that
mainstream. number is expected to climb to 1. 8 million
While the Alberta heavy oil endowment is barrels daily.
Alberta’s oil sands and heavy oil often presented as one monolithic
production averages over 1. 2 million deposit, it is in fact a collection of over 30 Ninety per cent of the 1.7-trillion-barrel
barrels. By 2020, it is expected that significant fields found in six major reserve can be recovered using in situ
production will top three million barrels regions. And each of the deposits features technologies, whereas only 10 per cent of
per day from these sources and could hit unique recovery technologies and the total can be recovered using mining
five million barrels per day by 2030, with marketing challenges. techniques. Oil sands between 70 to 75
anticipated technologies and favourable metres of the surface are mined.
economic conditions. Some estimates By far the largest deposit is the Athabasca
put ultimate production as high as five oil sands, which surrounds the northern
million barrels per day, which will make Alberta town of Fort McMurray. It has an
Canada the fifth largest oil producer on estimated 1. 3 trillion barrels of bitumen
the planet, just behind Iran. in place.
“That becomes a major world power,”
says Greg Stringham, vice-president of The next largest deposit is the Cold Lake
markets and fiscal policy for the oil sands, which has a resource of around
Canadian Association of Petroleum 200 billion barrels of bitumen, followed by
Producers, a lobby group representing the Peace River deposit with around 130
major oil and gas producers in the billion barrels in place. Alberta also has
country. “Ten years ago, it was a trickle, two substantial conventional heavy oil
but there is no reason it can’t grow from fields at Lloydminster, which borders
here. The price of oil doesn’t have to be Alberta and Saskatchewan, and on the
at $57 to keep it going. Oil sands costs Suffield military range in southeastern
have come down significantly, it is very Alberta. The resource base on both sides
competitive with conventional oil and of the Alberta and Saskatchewan border is
gas right now.” over 30 billion barrels, but much of this
heavy oil is found in thin pay zones that
Fort
McMurray
Peace
River
Cold
Lake
Edmonton
Alberta’s heavy oil resource has risen in are uneconomic to produce.
the global consciousness for a number of
reasons. CIBC World Markets chief Each of the fields uses distinct recovery
economist Gerry Rubin says the most methods.
obvious reason is that there are few
good targets left for international players The Athabasca oil sands consists of
to chase, causing them to hunt for less deposits that are shallow enough to mine.
conventional opportunities. Currently over 600,000 barrels per day are
