The Oil Drum

With arctic sovereignty increasingly in dispute due to potential oil and gas discoveries in a warmer world, the various interested parties seem almost desperate to stake their claim (and some are apparently more desperate than others). Meanwhile sovereignty debates continue further south at the Montebello SPP summit.

Danny Williams (one scary poker player), finally suceeds in securing a deal on the Hebron field after calling the oil companies' bluff. They said they had plenty of other opportunities if Newfoundland wouldn't play ball, but in a peak oil world Williams said they'd come back to the table, and they did.

As for the developing credit crunch, risk appears less and less contained over time, as international concern grows over the highy-rated 'assets' derived from the American mortgage market. Even money market funds are beginning to experience a flight to quality.

Russian arctic images 'from Titanic'

Russia faces embarrassment over its flag planting expedition to the North Pole after claims that state broadcasters borrowed scenes from the movie Titanic to "beef-up" footage. Television company Rossiya sent images of mini submarines descending to the ocean floor around the world in its report about the mission.

But a 13-year-old boy from Finland spotted the scenes in the national daily newspaper Ilta-Sanomat, and realised that they resembled images on his Titanic DVD.

He told the newspaper: "I checked it with my DVD and there it was right there in the beginning of the movie: exactly the same image of the submersibles approaching the ship."

Titanic, made by James Cameron and starring Leonardo DiCaprio and Kate Winslet, opens with pictures of divers inspecting the 1912 shipwreck. The news programme is accused of merging real footage with the movie shots under the caption "northern Arctic Ocean", according to the Guardian.

It reported that Rossiya had refused to comment on the footage but said its Vesti news programme had originally been filmed using scale models in a studio.

This is the first version of a monthly post about the last production numbers from Canadian oil sands (also called Tar sands).

Various forecasts for Synthetic Oil Crude (SCO) and Non-Upgraded Bitumen (NUB) derived from oil sands.

Update [2006-6-20 15:19:22 by Dave]: Perhaps this should be considered a follow-up to HO's excellent post Mining Canadian Oil Sands into the future. It's not meant to be a rebuttal of any kind since I am really looking at different issues pertaining to tar sands production. I apologize for its length but it seemed necessary to make my points.

The "missing link" to the Uppsala paper (pdf) has been corrected.

I was investigating sour gas and it turned out that about 30% of the gas produced in the Western Canada Sedimentary Basin (WCSB) is sour. As things do, one thing led to another and I found that this gas can be "sweetened" and used although it contains H2S (hydrogen sulfide), which is toxic at levels as low 10 ppm (parts per million). However, the real path and story became natural gas usage to carry out production of the tar sands.

There turns out to be a worrisome supply issue. Here are some claims made about tar sand production going forward.

Predictions for Tar Sands Oil Production
Figure 1 -- Click to Enlarge

However, tar sands production of approximately 1.0/mbd in 2005 also used 0.72/bcf (billion cubic feet) of natural gas as I read in this brief press release.

According to the NEB's [National Energy Board of Canada] 2006 oil sands Energy Market Assessment, the amount of gas used in oil sands production will rise to 2.1 billion cubic feet a day in 2015 from about 700 million cubic feet last year....

"We don't see any issues on gas availability," said Bill Wall, oil technical specialist for the NEB.

This story is about why I don't believe Bill.

Well, let's see I have put on the helmet, the breast plate, the greaves and all that stuff, and so perhaps I might be armored enough to tip-toe into the debate about oil sands and oil shale. Tonight will be oil sand, if I survive and recover, then (after reading a few more scientific papers) I will tackle oil shale.

Just recently there has been increasing attention paid to the heavy oil sands of Alberta. Perhaps, as in the case of the Washington Post more negative than positive. And it is interesting to note, from the tone of those pieces, that it is now apparently more desirable to have your rivers flow over and through tarry sand, than to have the sand cleaned and replaced, along with the river. But it is not that argument that I would follow, but rather, OGJ having come out with a Supplement on Canadian Oil and Gas, to briefly comment on one or two of the features of that report. (Which apparently will take a while before it appears in the electronic version of the magazine).

Many cornucopians see Canada as the savior of America's bacon because of the tar sands, especially those of Athabasca.

Will Canada complacently allow the US to pillage her resources as energy supplies become more scarce?  Further, will she become discontented enough with that idea to cause a political rift between Canada and the US when she sees her own future energy security being compromised?  Will the NAFTA energy sharing provisions hold up, maintaining fungibility of scarce resources?  There seem to be many questions that need to be asked about this supposed panacea of a relationship; some ideas of the potential answers under the fold.

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:

1. The technology required to mine the sands and convert it into refined oil is expensive and the whole operation has a fairly low EROEI.
2. Lack of appropriately trained labor force, coupled with the fact that Fort McMurray, Alberta is not a particularly desirable place to live
3. Environmental disaster (although at least Canadian law says requires that old mines are refilled and trees are replanted)
4. 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
There's more… (0 words) | 83 comments | | Permalink | Without comments