Alberta’s Oil Sands…….
A Canadian Success Story
Jim Carter
Western Canadian Arbitrators Round Table
Energy Forum
Calgary, Alberta
May 15, 2012
Global Energy Demand Continues To Grow
Source: http://www.eia.doe.gov/oiaf/ieo/highlights.html
2
260
211
175
137
115
101.5
92
60
46
Saudi Arabia
Venezuela
Alberta/Canada
Iran
Iraq
Kuwait
Abu Dhabi
Russia
Libya
World Oil Reserves
(billions of barrels - established)
Alberta (171)
46
37
30
25
20
19
13
10
Libya
Nigeria
Kazakhstan
Qatar
China
USA
Brazil
Mexico
Source: Oil & Gas Journal, January 2011
Only 21% of the world’s proven oil reserves are accessible to
private sector investment (not state controlled); 53% of the
world’s open and accessible reserves are in Alberta’s oil
sands.
3
Sources of U.S. Oil Imports (2010)
Total U.S. Demand: 19.15 million bbl/d
Total Imports: 9.16 million bbl/d
ALBERTA
Sources: US Energy Information Administration
National Energy Board (Canada)
Note: Total does not add up to 100% due to rounding
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Oil Sands Development and
Canada’s Economy: 2010-2035
• The development of Alberta’s oil sands will deliver economic benefits throughout Canada:
� $91.3-$132.7 billion per year
in GDP gains (2010-2035
average)
The range of these
results depends on the
ability to secure pipeline
access to new markets
for growing oil sands
production
average)
� 482-707 thousand jobs per
year (2010-2035 average)
� $27.9-$37.9 billion per year
in worker wages (2010-2035
average)
SOURCE: Economic Impacts of Staged Development of Oil Sands Projects in Alberta (2010-2035), Canadian Energy Research
Institute (CERI), June 2011
Canada’s Offshore Oil & Gas
Atlantic Canada - Newfoundland
and Labrador
• Producing oil projects – Hibernia
(1997), Terra Nova (2002) and
White Rose (2005), North
Amethyst (2010)
• Hebron Project in 2017Hebron Project in 2017
• Produce 270,000 bpd = 35% of
Canada’s conventional light crude
production and 10% of all
Canadian crude oil
Nova Scotia
• 1 producing natural gas field –
Sable (1999)
• Deep Panuke in 2012
Source for Graphics: Canadian Centre for Energy Information Publication, 20046
What are the Oil Sands?
• Naturally occurring mixture of sand, clay, water and bitumen –a very heavy oil
• Bitumen is separated from the sand and upgraded to refinery-ready crude oil
7
Mineable oil sands only exists under 0.1
per cent of Canada’s total boreal forest
3,200,000 km2 – Boreal Forest
715 km² disturbed to date
72 km² reclaimed to date8
Source: Alberta Government Presentation, July 2011
Oil sands production technologies have significantly evolved…
Mining – 20% of the oil sands resource is less than 200 feet deep
Source: Canadian Centre for Energy InformationSource: Canadian Centre for Energy Information
In-Situ – 80% of the oil sands resource is more than 200 feet deepCyclic Steam ProcessSteam Assisted Gravity Drainage
(SAGD)In-situ operations:• Do not have mines• Or tailings ponds• And they do not take water from the river
9
Air/GHG emission Limits
Water intake & discharge limits
Regional Air Quality Monitoring
All aspects of Environmental Impacts are Regulated/Monitored
Mandatory/ Required reclamation
Regional Water Quality Monitoring
limits
10
98 102 102 102 106 102 104
Wells-To-Wheels Carbon Emissions
Source: Jacobs Consultancy, Life Cycle Assessment Comparison for North America and Imported Crudes, June 200911
Oil Sands and GHGs in Canada
The oil sands in a carbon
constrained world…
• Oil sands = 6.5% of Canada’s 2009 GHG emissions
Other
3%Oil Sands
(Production and
Upgrading)
Agriculture
8%
Buildings
11%
0% 0%0%
Canada GHG Emissions
• Oil sands producers reduced average per barrel GHG emissions by 29% between 1990 and 2009
Upgrading)
6.5%
Other Oil and
Gas Production
and Refining
17%
Transportation
25%
Electric
Generation
17%
Industrial
14%
12Source: Alberta Government Presentation, July 2011
Increasing Energy Efficiency in Extraction Processes…
…are now the norm.
13
New Technologies will Decrease Carbon Footprint…
THAITM Solvent Recovery
Electro Thermal
Dynamic Stripping
Geothermal
14
CCEMC - Mandate
CCEMC is enabled through the Government of Alberta’s
regulatory approach
CCEMC is an Alberta based not-for-profit corporation with a
mandate to reduce greenhouse gas emissions and improve
the ability to adapt to climate change by investing in the
discovery, development and deployment of clean technology
• Large regulated emitters must meet performance targets
• Three options to comply – achieve target, offset or pay
• Compliance is annual
• The Fund is managed by the government
• Funds are segregated
• CCEMC – a delegated administrative organization
regulatory approach
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In business for 2+ years – funding is refreshed annually
• Announced funding for 32 clean technology initiatives in 15
months
• More than $167M allocated
• More than $823M in project value (leverage 4:1)
• Emissions reduction estimated at 1.7MT/yr or 17 MT/10 yr
CCEMC Performance
• Emissions reduction estimated at 1.7MT/yr or 17 MT/10 yr
• Expect >$1B worth of projects by end of this year
• SME RFP currently under review – May
• New RFPs to be announced this spring
o Energy efficiency
o Renewable energy
16
Portfolio by Strategic Area
• Alberta is investing more in Carbon Capture and Storage, on a
per capita basis than any other jurisdiction in the world
• CCS expected to achieve 139MT (70% of 2050 reduction
targets)
• $1.6B invested in Three Projects
Alberta – CCS Investments
• $1.6B invested in Three Projects
o Quest Project (Shell, Chevron, Marathon)
o Alberta Carbon Trunk Line (Enhance/NorthWest Upgrading)
o Swan Hills SynFuels - Insitu Coal Gasification
• 4MT target starting in 2015
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Thank you
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EXTRA SLIDES
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Oil Sands Mining Projects – Summary
Project Status Production Capacity (bbl/day)
Projects in Operation 1,210,000
Projects Under Construction 290,000
Projects with Regulatory Approval 1040,000
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Projects with Regulatory Approval 1040,000
Projects Under Regulatory Review 420,000
Projects Announced/Disclosed 530,000
Total Production Capacity 3,490,000
*Project information valid as of June 2011. Public sources used.
Oil Sands In-situ Projects – Summary
Project Status Production Capacity (bbl/day)
Projects in Operation 875,000
Projects Under Construction 495,500
Projects With Regulatory Approval 905,955
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Projects With Regulatory Approval 905,955
Projects Under Regulatory Review 689,500
Projects Announced/Disclosed 2,463,000
Total Production Capacity 5,488,955
*Project information valid as of June 2011. Public sources used.
…In-Situ Projects are “doable” in smaller sizes than mining projects – smaller
players creating diversity