The Oil Drum | DrumBeat: September 17, 2008

236 comments on DrumBeat: September 17, 2008

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BOP on September 17, 2008 - 9:16am

Oil sands economics under pressure

CALGARY AND VANCOUVER — As the U.S. banking crisis boosts borrowing costs and crude prices plummet on global demand fears, the economics of building oil sands projects are coming under pressure.

The price of oil, which fell to $91.15 (U.S.) a barrel – its lowest level since Feb. 11 and a far cry from the nearly $150 price in July – is approaching levels at which firms will start to question the profitability of new billion-dollar oil sands projects.

http://www.theglobeandmail.com/servlet/story/RTGAM.20080917.wrbanksoil17...

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BOP on September 17, 2008 - 2:36pm

Petro-Canada is talking itself out of the Fort Hills oil sands project.

The latest cost estimates on the project, released late Tuesday, highlighted a 50-per-cent spike in expenses over the past 15 months, on a project that was already projected to eat up $14.1-billion. . . .

The first take from analysts on Wednesday is Petrocan, owner of a 60 per cent stake in Fort Hills, will need to see $100-a-barrel crude oil prices to earn a 10 per cent return on Fort Hills.

http://www.theglobeandmail.com/servlet/story/RTGAM.20080917.WBstreetwise...

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236 comments on DrumBeat: September 17, 2008

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