Canada’s tar sands/oil sands will still be producing heavy oil in the year 2117, even if the era of fossil megaprojects is being replaced by an emphasis on “bite-sized” projects, Suncor Energy CEO Steve Williams told the Calgary Herald in a recent interview.
“In 100 years’ time, the oilsands will still be being developed and still operating,” Williams said. “It will be one of the most valuable energy resources in the world because we’ll be using the best technologies. We’ll be finding the best way to have minimal, if any, impact on climate change and the planet.”
That rather rash prediction drew a sharp reply from Edmonton-based Greenpeace Canada campaigner Mike Hudema. “If we’re still producing oil from the oilsands” in 100 years, he said, “it means that we have failed to do what we need to do in order to save the planet. The tar sands are an environmental disaster, and the situation is not getting much better.”
Williams claimed Suncor has operating costs down to a point where production is profitable at US$37 per barrel. Emissions from its tar sands/oil sands operations are “broadly equivalent to other crudes on this continent, and we’re in a position to take it to an even better position,” he added. “If you think high cost and carbon intensity are the issues, both of those are being removed as the major issues now.”
The Herald had no specific numbers to back up that contention, but the rest of the story shows the industry losing nearly two-thirds of its investment since oil prices crashed three years ago.
“Oilsands producers have gone from spending nearly C$34 billion in 2014, the last year of the boom when prices plunged, to plunking down $13 billion this year as major construction projects are wrapped up,” the Herald reports. Now, “Suncor has proposed a series of 10 smaller projects at its existing reserves, each of which would produce 30,000 to 40,000 barrels per day, and potentially start churning out oil in 2022. To put this in perspective, the Suncor-led mine in Fort Hills, expected to start producing this year, will pump out 194,000 barrels per day at full capacity.”
Suncor expects the 10 projects, which will total 360,000 barrels per day, to cost about $2 billion each to develop. Go/no-go decisions are set for late next year or early the following.
“The idea is to design one project and replicate the model for the remaining phases, improving it along the way,” the Herald notes. “This approach cuts costs and scales back the turnaround time from the point of company approval to first oil production, which spanned five to eight years with megaprojects but is expected to last just two or three under this bite-sized style.”
