# Presentation: 630924

## Sand, water, clay and gravel containing a sticky, heavy form of oil called bitumen, in concentrations ranging from one to 18 percent.  

- Sand, water, clay and gravel containing a sticky, heavy form of oil called bitumen, in concentrations ranging from one to 18 percent.

- It takes about two tons of mined oilsand to produce one barrel of synthetic crude.

- Bitumen must be separated and thinned or heated so it can flow through a pipeline.

**What are the Oilsands?**

## Oil Sands Boundaries

- Athabasca – mineable area

- Peace River

- _Oil Sands Area Boundaries_

- Cold Lake

- Athabasca

**Athabasca**

**Peace River**

**Cold Lake**

**Notes:**
Total surface area within the oil sands regions totals over 14 million hectares with almost 3.5 million hectares under lease (24%).  The size of the surface mineable area is 2.5% of the total oil sands region.  This area holds 7% of the barrels in place of total oil sands where the Wabiskaw-McMurray Formations hold the reserves.

Virtually all of the surface mineable area is leased (about 315 thousand hectares = 90%).  Lands not leased include:
potential land claim areas
Surface restrictions due to historical resources, etc.
Environmentally sensitive areas

Currently, there are 2,093 oil sands agreements.
Six companies hold 50% of the leased barrels in place.
16 hold 75%
31 hold 90%

Land Sale Activity:	2003	YTD 2004 (Oct. 13th)
Hectares Sold		64,350	184,000
Price Per Hectare	$276.16	$197.22
Bonuses Rec’d		$18 million	$36 million

Rentals and Fees:    $11,823,840

## Alberta’s Oilsands

**Alberta’s Oilsands**

## Nature of the Oilsands Resource

- 90%

- 10%

**Nature of the Oilsands Resource**

**Notes:**
This slide shows some of the geology of the resource that results in it being amenable to different methods of production
The resource underlying shallow  overburden is recoverable by surface mining methods
This is the only place in the world where liquid petroleum is mined using shovels and trucks
pilot project in Australia, where Canada’s Suncor is involved in partnership to mine shale and recover liquid petroleum using Canadian technology
mining implies very high recovery rate of resource in place, but needs ore grade >6% to make it worthwhile

Deeper resource must be recovered using In situ techniques
because of the flow characteristics of the resource, generally needs some form of stimulation -- usually steam to get it to flow

## Technology

**In Situ**
- Cyclic Steam Stimulation
- Steam Assisted Gravity Drainage
- VAPEX (vapor extraction)
**Surface Mining**
**Upgrading**

## How Much Oil?

**This is second only to Saudi Arabia’s 262 billion barrels of proven reserves and ahead of Iran’s 126 billion barrels.**
**Production is expected to increase from just over one million bpd. to nearly three million by 2015.  These figures may prove to be conservative in light of ever increasing investment levels and new, more productive technology.**
**Proven reserves only measure oil that can be economically recovered at current prices with existing technology.  Alberta’s total resource in place comes to over 1.7 trillion barrels.  Experts believe that about over 300 billion barrels will actually prove recoverable.**
**Only a small fraction (20%), where reserves are less than 75 meters below the ground, can be mined.  Accessing the balance (80%) requires in-situ technologies.**

**How Much Oil?**

## Canadian Oil ProductionConventional, Oil Sands and Offshore

**  ****Source: CAPP**

**WCSB Conventional Oil**

**Oil Sands**

**Offshore**

**Actual**

**Forecast**

_**Oil Sands Growth**_**     2006 = 1.1 million b/d**
**Base Case:**
**2020 = 4.0 million b/d **
**Constrained Case:**
**2020 = 3.3 million b/d**

*Constrained Case Total*

## Total Oilsands Project Production:2003-2015

**Total Oilsands Project Production:****2003-2015**

## Construction Workforce Outlook – Nov 2005

**Source: Construction Owners Association of Alberta (COAA) Nov 2005**

- IOL – Mackenzie Gas Project

- Synenco Northern Lights
- Phases 1 & 2

- Suncor Firebag
- mining & extraction

**Albian Sands Downstream Exp**

**Albian Sands Jackpine Mine **

**North West Upgrader**

**Suncor Firebag & **
**Voyageur**

**Syncrude S3dbn**

***CNRL – Horizon***
***Phases 1 &2***

**Syncrude UE1 & SERP**

**PC/UTS Forth Hill **

- OPTI Canada/ Nexen Upgrader

**CNRL Horizon Phase 3**

**IOL Oilsands Mine**

**Conoco Surmont**

**Petro Canada**

- Syncrude SERP

**IOL**

- Husky Tucker Thermal

- EnCana Foster Creek

## Construction Workforce Outlook – Oct 2006

**Source: Construction Owners Association of Alberta (COAA) Oct 2006**

**CNRL – Horizon**
**Phases 1 &2**

- IOL – Mackenzie Gas Project

- OPTI Canada/ Nexen Upgrader

**IOL Cold Lake**

**Suncor Firebag & **
**Voyageur**

**Albian Sands – Jackpine & Upgrader Expansion**

**PC/UTS Fort Hill**** **

**Conoco Surmont**

**Petro Canada**

- Synenco Northern Lights
- Phases 1 & 2

**Joslyn**

**Syncrude UE1**
**& SERP**

**Northwest**

**Syncrude**

**North**
**American**

## What Does it Cost to Produce?

| Below ground cost/barrel | Operating
Cost | Supply 
Cost |
| --- | --- | --- |
| Conventional heavy oil production | $4 - $7 | $10 - $14 |
| Steam Assisted Gravity Drainage (SAGD) | $8 - $14 | $11 - $17 |
| Cyclic Steam Stimulation (CSS) | $8 - $14 | $13 - $19 |
| Above ground cost/barrel |  |  |
| Mining | $6 - $10 | $12 - $16 |
| Mining and upgrading | $12 - $18 | $22 - $28 |

**What Does it Cost to Produce?**

## Canadian & U.S. Crude Oil Pipelines

***Platte***

**St. James**

**Burnaby**

**Portland**

**Salt Lake City **

**Houston**

**Anacortes**

**Enbridge Gateway**
- Capacity	400 kbpd
- In service	2012-14

***Express***

**Montreal**

**Lima**

**Chicago**

**Cushing**

***Trans Mountain ***

**TransCanada**
**AB-California**
- Capacity	400 kbpd
- In service	2012
**AB-USGC**
- Capacity	400-600 kbpd
- In service	2012

**Guernsey**

**Hardisty**

**Edmonton**

**Kinder Morgan**
**TMX Northern Leg**
- Capacity	400 kbpd
- In service	2012
**TMX2 Expansion**
- Capacity	100 kbpd
- In service	2011
**TMX3 Expansion**
- Capacity	300 kbpd
- In service	2011

***Enbridge***

***BP***

**Enbridge North**
**Alberta Clipper**
- Capacity	450+ kbpd
- In service	mid-2010
**Southern Access**
- Capacity	400 kbpd
- In service	2009
**Southern Lights**
- Capacity	185 kbpd
- In service	4Q 2008
**Line 5 Expansion**
- Capacity	50 kbpd
- In service	2008
**Line 6B Expansion**
- Capacity	44 kbpd
- In service	2009
**Line 6C New Line**
- Capacity	350 kbpd
- In service	2011
**Line 9 Reversal**
- Capacity	180 kbpd
- In service	2009

**Sarnia**

**TransCanada**
**Keystone**
- Capacity	435 kbpd
- In service 	late 2009
**Cushing Extension**
- Capacity	155 kbpd
- In service	late 2010
**Heartland Extension**
- Capacity	600 kbpd
- In service	2009-10

**Enbridge South**
**New Line**
- Capacity	450 kbpd
- In service	2010
**New Line**
- Capacity	na
- In service	2012-14
**Spearhead Expansion (N/S)**
- Inc. Capacity	65 kbpd
- In service	2009
**North Loop to Chicago**
- In service	2009
**Enbridge New Line**
- Capacity	400 kbpd
- In service	2010

**BP**
**Light line ex-Chicago**
- Capacity	180 kbpd
- In service	2009

**Altex**
- Capacity	250+ kbpd
- In service	2011

**Kinder Morgan**
**Express Option 1**
- Capacity	160 kbpd
- In service	2010
**Express Option 2**
- Capacity	55 kbpd
- In service	2010
**Express Bullet**
- Capacity	400+ kbpd
- In service	2010
**Express Routing**
**Patoka South**

**Wood**
**River**

**Patoka**

**Sunoco New Line**
- Capacity	200 kbpd
- In service	2012

***ExxonMobil***

**Canadian & U.S. Crude Oil Pipelines**

## Energy Facilities in Alberta

**Pipelines – more than 350,000 km**
**Gas processing -****   529 sweet gas plants****   275 sour gas plants**
**Oil sands –****  30 (2006) commercial plants ****  95 (2006) primary recovery projects **
**Oil upgraders –****  4 upgraders (810,000 barrels per day capacity)**
**Oil refineries (capacity) -****  5 facilities (907,300 bbl per day capacity)**
**Petrochemicals –  5 major petrochemical sites**

**Energy Facilities in Alberta**

- Source: EUB and CAPP

**Notes:**
These are non abandoned wells.

## Canada’s Oil Sands:Challenges to achieve this potential

- Continuing to Lower Costs
- Alternatives to natural gas for fuel – free it up for other markets
- Renewed focus on Research and Development
- Workforce and Infrastructure
- Ensuring adequate workforces – trades, technical, professional
- Roads, Housing and Municipal services
- Access to Markets – Pipelines/Refineries
- Need new pipelines
- Decisions needed now for pipelines in 4-5 years
- Need new refineries, expansions and modifications
- For many conventional refineries, oil sands is either heavier (bitumen blend) or lighter (upgraded crude) than their current feedstock

## Oil & Gas Field machinery (heavy-duty equipment rental, repairs, services)

Pipes, valves and fittings, refinery equipment

Fuels and Fuel Storage

Mining equipment

Construction Equipment, Materials & Services (building, electrical, plumbing, carpentry, concrete, etc.)

Security equipment

**Pipes, valves and fittings, refinery equipment**
**Fuels and Fuel Storage**
**Mining equipment**
**Construction Equipment, Materials & Services (building, electrical, plumbing, carpentry, concrete, etc.)**
**Security equipment**

**Opportunity for U.S. Exporters**

**Accommodation and Related Services**
**Communication Systems (telecommunications, cellular, internet, cable).**
**Safety & Medical (facilities, supplies, services)**
**Logistics (materials handling, freight, vehicle sales rentals & repairs)**
**Environmental control equipment**

## GO EXPO PETROLEUM SHOWJUNE 12-14, 2007CALGARY, ALBERTA, CANADA

**600 Exhibiting companies**
**18,000 visitors**
**U.S. Dept. of Commerce U.S.A. Pavilion:**
- exhibition space
- 4 – 6 appointments
- Market briefing breakfast
- U.S. Consulate hosted reception
- $3750 per company

**THE 2006 GLOBAL PETROLEUM SHOW**

## Contact Us

- U.S. Consulate General, Calgary
- 1000, 615 Macleod Trail SE
- Calgary, Alberta, Canada

- Phone:  403-265-2116     Fax:  403-266-4743

- Sharon.Atkins@mail.doc.gov
- Crystal.Roberts@mail.doc.gov

- www.buyusa.gov/canada

**Contact Us**

## Acknowledgements

- The Canadian Association of
- Petroleum Producers

- Alberta Economic Development

- Alberta Energy & Utilities Board