A primer on Canadian oil sands

Canadian oil sands have long been recognized as one of the world’s largest endowments of oil resources with over 170 billion barrels in place. The resource endowment places Canada second only to Saudi Arabia.

Canada’s oil sands are located in Alberta, and unlike conventional crude oil, the oil sands come in the form of bitumen, a heavy, thick, and viscous substance that requires more intensive extraction techniques than traditional oil production. Oil sands are produced either from surface mining or in situ processes (see Figure 1). About 80 percent of the recoverable oil sands reserves can be extracted using in situ methods, which in contrast to surface mining, cause less damage to the local environment. SAGD (Steam Assisted Gravity Drainage) is the most common form of in situ production and is energy intensive because it uses steam generated from natural gas to heat the bitumen so it can flow to the surface (see Figure 2 below). About 20 percent of the oil sands are recoverable through mining operations where oil sands are scooped from the surface and moved in trucks. Mining methods scar the landscape and have historically required long time periods to complete reclamation programs, particularly given that tailings ponds can take up to thirty years to fully settle. These two methods of production, mining and in situ, contribute higher volumes of greenhouse gas (GHG) emissions than the production of conventional crude oil because of the relatively high energy use and/or removal of the land surface.

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