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Thread: End of the Oil Sands?

  1. #1

    Default End of the Oil Sands?

    Maybe Trudeau was right re a phase out?

    Once considered a safe bet, Canada’s vast deposits are emerging as among the first and most visible reserves at risk of being stranded by a combination of high costs, low prices and tough new environmental rules.

    “For a lot of reasons the oil sands look like a prime candidate for eventual abandonment,” said Jim Krane, an energy fellow at Rice University’s Baker Institute. “One problem is that costs are persistently higher. The high carbon content only makes it worse.”

    During most of the past decade, Exxon and other giant oil companies spent billions of dollars in Canada as part of a global quest for new sources of supply, as analysts cautioned about “peak oil,” or the risk of running out of the resource. Prices surged to $140 a barrel.

    Companies were driven in part by the need to replenish their reserves of oil and gas, since investors have traditionally looked at such numbers as an important barometer for a resource company’s future.

    But now, the worry is more about “peak demand.” Amid a glut of supply that led to a price collapse in 2014 and a tepid recovery, investors and executives at some of the world’s biggest energy producers are considering the possibility that oil demand could peak and then slow in the coming decades.

    The shift from a preoccupation with insufficient supply to worries about demand has altered investment priorities away from high-cost opportunities in the Arctic, ultra-deep waters and the oil sands.

    Such projects can require billions of dollars in upfront investment and seven to 10 years, or more, to bring returns. Instead, companies are increasingly focusing on new sources of crude oil, such as shale, that don’t require the same massive investment and that can get from development to production much more quickly.
    https://www.wsj.com/articles/energy-...und-1487327406

    I think this ignores a little bit that there is pressure on private equity to find new investments, but there is without question a serious issue over whether the costs justify the expenditure versus less capital intensive shale.

  2. #2
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    Keyston is a go....in case some are wondering...that's "good news" for Alberta.....watch the oilsands capex increase 10X....yay!

  3. #3
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    Thank you President Trump, all that screwing around with Obama..mr Green head

  4. #4

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    Quote Originally Posted by moahunter View Post
    Maybe Trudeau was right re a phase out?

    Once considered a safe bet, Canada’s vast deposits are emerging as among the first and most visible reserves at risk of being stranded by a combination of high costs, low prices and tough new environmental rules.

    “For a lot of reasons the oil sands look like a prime candidate for eventual abandonment,” said Jim Krane, an energy fellow at Rice University’s Baker Institute. “One problem is that costs are persistently higher. The high carbon content only makes it worse.”

    During most of the past decade, Exxon and other giant oil companies spent billions of dollars in Canada as part of a global quest for new sources of supply, as analysts cautioned about “peak oil,” or the risk of running out of the resource. Prices surged to $140 a barrel.

    Companies were driven in part by the need to replenish their reserves of oil and gas, since investors have traditionally looked at such numbers as an important barometer for a resource company’s future.

    But now, the worry is more about “peak demand.” Amid a glut of supply that led to a price collapse in 2014 and a tepid recovery, investors and executives at some of the world’s biggest energy producers are considering the possibility that oil demand could peak and then slow in the coming decades.

    The shift from a preoccupation with insufficient supply to worries about demand has altered investment priorities away from high-cost opportunities in the Arctic, ultra-deep waters and the oil sands.

    Such projects can require billions of dollars in upfront investment and seven to 10 years, or more, to bring returns. Instead, companies are increasingly focusing on new sources of crude oil, such as shale, that don’t require the same massive investment and that can get from development to production much more quickly.
    https://www.wsj.com/articles/energy-...und-1487327406

    I think this ignores a little bit that there is pressure on private equity to find new investments, but there is without question a serious issue over whether the costs justify the expenditure versus less capital intensive shale.
    This is just an opinion piece. I was reading the other day basically the same article only in reverse. The opinion I read was that in spite of all this green technology the world is still going to keep on needing oil. In fact, the piece I read said more barrels per day are going to be needed not less.
    There are as many 'opinions' on the oil industry as there are grains of sand. The truth is out there somewhere.
    "The man who does not read has no advantage over the man who cannot read." –Mark Twain

  5. #5
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    Not Oilsands related but: it's over at Encana Tower, Sunrise and Saturn Ph2....3.5 billion worth of Gas plants are coming to an end next month....Just north of Dawson Creek or south of John. 3000 contractors peaked in July...45per cent from Edmonton, about 30 percent from Calgary and the rest were pot smokers from the Island. And very very few of these of these workers have other projects to go to.....

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