Canada looks to double oil sands output

WASHINGTON, March 28 In 2006, Canadian producers put out 1.1 million barrels per day of oil from their oil sands reserves.

Greg Stringham, vice president of the Canadian Association of Petroleum Producers, said they have two possible outlooks for the future of Canadian oil sands; both involve increased production, it's just a matter of how much.

"Conventional oil production is slowing but oil sands will grow," Stringham said at the Energy Information Administration 2007 Annual Energy Outlook in Washington Wednesday. Under ideal conditions, by 2015 production is predicted to be between 2.9 million and 3.5 million barrels a day and between 3.3 million and 4 million barrels per day by 2020. In a constrained scenario, the number is slightly less.

Some of the inhibitors Stringham suggested were in the number of refineries able to handle the heavy oil, the amount of available pipeline to transport it, the transportation infrastructure for moving construction equipment and the availability of construction work forces to build the oil sands recovery plants.

Costs of labor, tires and steel, among other things have driven up the cost of constructing a plant from $3.3 billion in 2001 to $10 billion in 2007.

One suggested solution was manufacturing components of the plants where the work force is more plentiful and then putting the pieces together on-site with a much smaller staff.

Copyright 2007 by UPI

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