Monday, July 23, 2007

Why are the Alberta oilsands important?



Within the next few decades, the world will face serious energy challenges.


According to international forecasts, the world economy is projected to grow from $47.2 trillion in 2002, to $112.7 trillion in 2025, representing an increase of 138.7 percent.


This level of growth will require a 50.5 percent increase in energy consumption. Oil is the world’s primary source of energy, followed by coal and natural gas. In 2025, oil will remain the world’s primary source of energy.


At present, world oil production is in the order of 85 million barrels per day.


By 2025, it is projected the world will need 119.5 million barrels a day. This level of increase ( 34 million barrels per day ) exceeds OPEC’s total current production.


Where will this oil come from?


Clearly, the Middle East, Russia, Africa and South America will need to increase production. However, as evident in media reports, these regions may not provide a secure, safe and reliable source of future energy to meet international needs.


Another concern is that the world’s conventional oil production is expected to peak over the next 20 to 30 years and will enter a period of decline. This will place enormous pressures to development non-conventional oil resources including the Alberta oilsands. Deep offshore exploration is expected to be an important source of future oil, but these resources must be found and developed at high cost. Energy conservation and use of alternative sources of energy are expected to help significantly, but will not eliminate the need for additional energy resources.


The Alberta oilsands are expected to make a significant contribution to future energy supplies. The key advantages of the oilsands is that they are secure, safe and proven, and -- they can be profitably produced at existing and projected world oil prices.

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