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Oil Sands Global Market Potential |
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November 14, 2006 |
 Energy Business Reports
P R E S S R E L E A S E
For Immediate Release
Press Contact:
Barbara Drazga
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Tel 800-304-0345
www.energybusinessreports.com
Oil Sands Global Market Potential
New Study from EnergyBusinessReports .com
Phoenix, AZ – November 14, 2006 – With most of the world’s known oil reserves concentrated in just a few countries, unconventional energy resources, such as oil sands, are now seen as a viable alternative to conventional oil and gas resources, and an attractive option for energy risk abatement.
Unconventional energy resources are resources that heretofore could not be recovered due to economic and/or technological barriers. However, as the price of oil and gas skyrockets and technology drives down the cost of oil sands recovery and production, this resource has become the new “black gold.” The demand for oil sands is expected to reach 10.31 million bbl in 2008, up from 8.59 million barrels in 2003 at an average annual growth rate (AAGR) of 3.7%.
Oil sands are a combination of clay, sand, water, and bitumen. They are heavy, black and viscous, but can be mined and processed to extract the oil-rich bitumen, which is then refined into oil. The bitumen in oil sands cannot be pumped from the ground in its natural state; instead oil sand deposits are mined using strip mining or open pit techniques or produced in-situ by underground heating or other tertiary recovery processes. Because oil sands require more complex production methods and additional upgrading to be usable as fuel, they are more capital intensive (for development, production, and upgrading) than conventional ones.
While the energy properties and potential of oil sands have been recognized for centuries, there had been no significant attempt to develop the resource until the mid 1960s. Investments in oil sands projects have become more attractive due to the increasing price of crude oil and technological advances that have enabled operators to bring down the cost of production. In less than 20 years of mining and upgrading, production costs have been cut in half.
The prospects for oil sands as an energy source depend on the rate and costs at which they can be recovered and converted into quasi-conventional reserves. This report addresses these issues as well as issues relating to the recovery, production, upgrading, transport, and marketing of oil sands.
Oil Sands Resources: Although oil sand deposits are found in more than 70 countries, three quarters of the world's reserves are located in two regions: Venezuela and the Athabasca region of northern Alberta and Saskatchewan in Canada. Oil sands represent as much as 66% of the world's total oil reserves, with at least 1.7 trillion barrels in the Canadian Athabasca tar sands and 1.8 trillion barrels in the Venezuelan Orinoco oil sands, compared to 1.75 trillion barrels of conventional oil, mostly located in Saudi Arabia and other Middle-Eastern countries.
Challenges and Opportunities: It is expected that high oil prices, coupled with robust global oil demand, will continue to drive oil sands expansion. New mining and transportation methods introduced in the 1990s have improved the efficiency and reduced the cost of oil sands mining considerably. However, challenges to extracting, transporting, and upgrading the resource remain and production is sensitive to many outside factors, including the price of natural gas, the availability of water, and pipeline capacity to and from the oil sands site.
Production Methods: After mining, the oil sands are transported to an extraction plant, where a hot water process separates the bitumen from the sand, water, and minerals in separation cells. Hot water is added to the sand, and the resulting slurry is piped to the extraction plant where it is agitated. The combination of hot water and agitation releases bitumen from the oil sands, and causes tiny air bubbles to attach to the bitumen droplets and float to the top of the separation vessel where the bitumen can be skimmed off. Further processing removes residual water and solids. The bitumen is then transported and eventually upgraded to synthetic crude oil. Roughly 75% of the bitumen can be recovered from sand, and about two tons of oil sands are required to produce one barrel of oil.
In-situ production methods are used on bitumen deposits that are buried too deep to be mined economically. These techniques include steam injection, solvent injection, and firefloods, in which oxygen is injected and part of the resource is burned to provide heat. Some of these extraction methods require large amounts of water and energy for heating and pumping.
Greatly increased pipeline capacity will ultimately be required to move synthetic crude from oil sands sites to refineries. The pipeline network currently in place will not be adequate to meet the transportation requirements for oil sands in the future. The expansion of pipeline capacity is extremely important because the current American market for oil sands products is becoming saturated.
About the Publisher: "Oil Sands Global Market Potential” is published by Energy Business Reports (www.EnergyBusinessReports.com ), an energy industry think tank and leading source for energy industry information and research products. Other reports available from EBR include: The Market for Cellulose Ethanol, Weather Risk Management, Natural Gas Storage Effects on Energy Trading, Fuel Cell Technology, The Outlook for Unconventional Gas, Securing Energy Assets and Infrastructure, The Market for Solar Photovoltaics, and Understanding the China Energy Market. This reports sells for $497 and can be ordered at www.OilSandsPotential.com .
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Summary
With most of the world’s known oil reserves concentrated in just a few countries, unconventional energy resources, such as oil sands, are now seen as a viable alternative to conventional oil and gas resources, and an attractive option for energy risk abatement.
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