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Alberta oil sands on 60 Minutes
Posted by Yankee on January 22, 2006 - 9:36pm
Topic: Geology/Exploration
Tags: 60 minutes, alberta, canada, fort mcmurray, oil sands [list all tags]
Did anyone else happen to catch the 60 Minutes piece on the Alberta oil sands? What most struck me about it is that the situation in Alberta seems to be a microcosm of many problems we've discussed with respect to peak oil. Namely:
- The technology required to mine the sands and convert it into refined oil is expensive and the whole operation has a fairly low EROEI.
- Lack of appropriately trained labor force, coupled with the fact that Fort McMurray, Alberta is not a particularly desirable place to live
- Environmental disaster (although at least Canadian law says requires that old mines are refilled and trees are replanted)
- Geopolitical factors: Namely, China is in a desperate competition with the US for these resources, and politicians are suggesting that Canada should use the oil sands to gain leverage in their trade disputes with the US
Another interesting aspect of the story was the appearance of T. Boone Pickens. At the beginning of the segment, the interview has Pickens looking like he's betting the farm on the oil sands:
"We're managing $5 billion here. And, about 10 percent of it is in the oil sands. So, it's the largest single investment we have," Pickens says.I was surprised to hear this, since as we know, Pickens has gone on record predicting that gas prices are going to remain at all time highs, and the reason for that is because of a shortage of world supply. Only at the end of the CBS piece does Pickens mention the end of cheap oil:And if oil sands are the answer for investors, does Pickens think the oil sands are the answer for the United States?
"Oh, I think so," he says.
Does Pickens think the days of cheap oil are gone?Unfortunately, the implications of this statement were far overshadowed by CBS's portrayal of the oil sands as the greatest energy source ever known to man. Indeed, they even ask, "Will the availability of an enormous supply of secure oil right next door mean America will have little incentive to reduce its dependence on oil?""They're gone," he says. "From what we knew as cheap oil, when I pumped gasoline in Ray Smith's Sinclair station on Hinkley Street in Holdenvale, Oklahoma, 11 cents a gallon, that's gone."
Will we ever again see $1.50 a gallon? "We won't ever see $1.50 a gallon. No, that's gone," says Pickens.
The answer, of course, is yes. According to CBS, it is inevitable:
But unless the Chinese go back to bicycles and Americans trash their SUVs, there will be buyers — for oil anywhere, no matter how it’s found or mined. Right now, Canada has become the land of opportunity for oilmen. They will tell you there is little else on the horizon.
I assume Suncor and others have done this - would just like to see the numbers....
But if you look at the bigger picture, Canada has trees, and natural gas, and water and tar sands. The US has people and art, and bombs. I guess one could plausibly make that conclusion.
I have been wondering if Canada breaks up that we might not acquire some extra states. If Quebec goes out, the possibility of the provinces going their own way, possibly in blocs like the Atlatnic Maritimes is possible. We might get Alberta as the 51st or 52nd state.
That is more likely (and not very likely I think) than our invading Canada. The American people would not go for it. We will go through a great deal of economic adjustment instead of doing something incredibly mean spirited and greedy.
It may not even be viewed as a bad thing when/if the time comes - US protects canada militarily in exchange for resource flow. I think there was a conservative think tank put out a piece in 2005 implying that NAFTA was the groundwork for an economic/military/resource conglomerate (I'll try and find the link)
I dont think there will ever be a 'battle', but in truth Ive never really researched it. I did try to look at [LATOC www.lifeaftertheoilcrash.net] but couldnt find any details.
p.s. Canadians (probably due to more degree cooling days) actually consume more oil per capita than americans...
Canadians do use more energy per capita than Americans. That is the last table I saw just before Christmas.
But we agree that it will not be a military action.
NAFTA does work, mostly, for our benefit. It does help integration of the economies and we can get a great deal from Canada. But with rising transportation costs in the future, that makes good sense for them too.
On this university campus nearly every building has NO insulation! The new buildings have about 2". The home standards changed in 1991 and were upped from 4 to 6" in the walls. My father was doing that for custom homes in the late 1960's. We have an industry that only adopts whatever standards we can get the government to pass.
Energy is so cheap that nobody cares yet.
Come on - taxes on my house are over 2x what it costs for natural gas, hydro and phone. The car is similar - purchase, maintaince and insurance dwarfing fuel costs.
In the case of my 1991 Chevy Sprint (around 60 mpg US) it cost more for brake and exhaust repair than gas!
"Green" friends live in nice neighbourhoods with good "community" but pay for it with old houses that have no insulation to speak of.
We sure see a lot more trucks / SUV'ish things on the roads in Michigan than here although I see enough mini-vans and that ilk to make me puke. Cars choking the streets and surburbia out the wazoo is the way we've gone too. Howver, unlike friends in the USA, up here you don't pick neighbourhoods because they are safe or because the schools are not going to have the roof collapse in winter.
Going into a different threat.
I want to believe in the book Fire and Ice and that we are diverging from the USA. Frankly the USA scares the @#$#@$ out of me. The government is disconnected from the people and US moderates / progressives I know are getting pretty scared of the way their country is going - but it doesn't seem to stop. There should have been riots over Robberts nomination to the court and I see that Alito will likely walk right in without a sacrifical Dem in the way.
My only consolidation is that you're destroying your own country now with the mountain top removal for coal; having the polluters in charge of the EPA etc etc - except that we're also getting the mercury in the air ...
There are very progressive factions within the USA - but I've pretty well given up on them. With thousands of white collar jobs now going overseas where PHDs are a dime-a-dozen you're not going to have a middle class much longer. It's a great place if you're rich or have a marketable skill.
The USA dream that I grew up in during the 60's is dead, gone and burried. The fangs are bare now, the blood is dripping - nobody harbours illusions about what the country is about except perhaps our Regressive Conservative party up here.
I work in construction and we are introducing styrofoam block construction that was developed in Canada with an R rating of 40 - well above the required 18 and very good.
I do find it funny that in colleges the ratio of liberals to conservatives for professors is about 9 to 1, while in the military for officers it is flipped and is 7 to 1 or 6 to 1.
America is not dead yet.
Everyone from the Cheney-ites on down consider it all to be a Mad Max future. What an intense failure of the imagination.
Let me extend the line of my original question a bit: There have been a lot of steps taken in recent years towards establishing systemic and operational integration between the US and Canada with regard to military matters. However, though I don't recall details offhand, I remember that some months back there were many voices in Canada (including across most of the Establishment political spectrum) who issued strong protests about certain aggressive steps the US was pressing for with regard to this integration.
I guess my question is this: What role, if any, are ruling elements in the US envisioning for this military integration as a possible means for facilitating an eventual takeover of Canada?
I called Cheney but he was taking a nap. Rumsfeld is out of town but will get back to me then I'll post here what I learn...
((seriously, no one can answer your question and the few that would have true insight into it, wouldnt be posting here...(or anywhere))
be more than happy to join Montana.
The talk gets louder when Quebec starts making independence noises.
BTW-on that 60 Minutes segment, I heard hot water mentioned twice, but never heard how they planned to heat the water (say with NG).
Also, I know that Canada just ended a fight to limit the amount of gas used to create the synfuels.
And this on who will be "paying a premium" for the chance to refine this stuff:
EnCana drops plan to process oilsands at Valero refinery
Last Updated Thu, 15 Dec 2005 16:57:08 EST
CBC News
EnCana Corp. and Valero Energy Corporation announced Thursday they have dropped a plan to process heavy crude oil from Western Canada oilsands at Valero's refinery in Lima, Ohio.
Abritrary lines that must be temporary.
BioRegions of Energy and Arable land/potable water will form first.
Or lack of energy delivered from above-say the New Orleans Gulf Coast.
I mentioned Canada because Canada actually has a spelled out way for the Provinces to secede.
A favorite book of mine and combined with Jane Jacobs'
Cities and the Wealth of Nations (that our cities are in transactions of decline)
and James Kunstler's-
"In The Geography of Nowhere I argued that the post-war enterprise of building suburbia as a replacement for towns and cities in the United States was a self destructive act. I argued that the living arrangement Americans now think of as normal suburban sprawl - is bankrupting us economically, socially, ecologically, and spiritually. I identified the physical setting itself - the cartoon landscape of car-clogged highways, strip malls, tract houses, franchise fry pits, parking lots, junked cities, and ravaged countryside - as not merely the symptom of a troubled culture but in many ways the primary cause of our troubles."
These three books form a foundation of sorts for my studies.
I'm now looking to the "Nine Nations" and their Capitol's and Second Cities for verification of trend.
Tyson's Corner becomes a new node, farther out, linking the outstretched veins with rings or beltways.
This can only work with cheap energy. And the center must remain vital. If only for geographic shortest route from Point A to Point B.
Here's a nice place to start
the most likely triggers for the break up are-
Energy, either lack of or hoarding.
Food, same as above.
Natural Disaster, one too many to handle.
Or a combo of the above.
I believe that collapse is already upon us. And has been for at least
5 years. With Kuwait's announcement, we're depleting at over 10% per year.
And of course there's Gaia and the fact that 7 Giga Tonnes CO2 must be removed from human annual output by 2020 or sooner as
Antarctica (rising seas) and the Amazon (biomass dieoff, end of CO2 sink) continue to deteriorate.
Peace, James
Current oil use worldwide: 84mbl/day. Projected for 2015: 105mbl/day.
Current oil sands production: 1mbl/day. Projected for 2015: 3mbl/day.
This is going to "solve our problem"???
And I don't recall that they even mentioned that, most of the year, they have to use massive quantities of natural gas to melt the crap enough to be able to scoop it out of the ground. And natural gas is running down quickly in North America.
By the way, those giant trucks ("toys") use over 100 gallons of diesel fuel per hour. Not good for yer EROEI...
This 60 Minutes piece qualifies as just more "don't worry" propaganda. Occasionally they do somewhat better, but they still serve the "powers that be" as much as the rest of them.
EROI only makes sense at a societal level, not an individual company. Which explains why no one is pounding on Charlie Hall and Cutler Clevelands door to fund EROI research....
Net energy is all that matters. So if they can ramp up to 3mbd and the EROEI is 3:1, then really they are only producing a net of 2mbd...
Why ?
Case 1 : EROEI of oil is around 20-30, and stays so (I doubt it). Then our problem will be to replace it with an equivalent or better energy source : coal, nuclear, solar or wind and to replace it in every sector of activity (ie switching to electricity for most energy consumer).
Case 2 : EROEI of oil is now 20 but decreases. Even with a flat extraction curve for the next 10 years as the Hubbert curve predicts, the decreasing EROEI will make less and less oil available for consumption (even if this would be only 1mbd/year) which will increase competition drastically.
So EROEI is an issue.
If I build a plant that's powered 100% by solar and wind, and it cooks tar sands into usable oil, or produces some other useful energy product via a completely different process, does it matter if the EROEI is lousy, or even if it's less than one? The energy input is not constrained in the long run by the finite nature of fossil or nuclear fuels, so if it takes 100 BTU's to produce only 10 BTU's of an energy product that's in a form the market values much more than the electricity I consumed to produce it, it still makes economic sense. (And since we're not up against a severe energy crunch yet, this is why batteries, which surely have a truly horrendous EROEI, sell in the bazillions.)
My point is that we have to look at ERO(non-renewable)EI to reach any meaningful conclusions. In many cases this is what people are talking about, as in burning vast amounts of NG to cook the oil out of the tar sands, even if they're not saying so explicitly. They're clearly making the assumption that we'll only ever run that process via burning NG, and such assumptions ("we'll always perform task X via method Y") are where a lot of predictions go off the tracks.