FP Comment: Benefits of Oil Sands
This comment by David McLellan of Calgary’s Petrobank Energy and Resources Ltd. makes a lot of sense, especially when you compare how much Canadians consume in terms of per capita barrels of oil – 9 times as much as the average Chinese. So, when those hypocrites bash China for this and that, remember how much Canadians consume and take for granted.
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Great jobs with environmental issues that are being dealt with
From an economic perspective, Canada currently stands out among its OECD peers. On a relative basis, we have not looked this strong in more than a generation, although it is by no means a given that we will retain this superior economic performance, with so many obstacles facing our historical trading partners.
It will be imperative to capitalize on our natural resource assets in particular, by developing and commercializing advanced technologies to facilitate their development in more economic and environmentally responsible way.
Consider that there is an irrefutable positive correlation between standard of living and energy consumption, proofed by an examination of current global petroleum consumption. The International Energy Agency reported that in 2011, Canadian per-capita annual consumption of petroleum was 24.6 barrels; the U.S. figure was 21.8 barrels, while the Chinese figure was just 2.7 and the Indian figure was a paltry one barrel. It is not unreasonable to assume that the populations of China, India and much of the developing world would be striving to achieve a Western style standard-of-living. It may be unreasonable to think they will get there soon, given their numerous challenges, but suppose they do get to a point where their per-capita consumption of petroleum rises to a level about one-third of North America’s. With populations of 1.35 billion and 1.2 billion respectively, that translates into more than 50 million additional barrels consumed per day, not accounting for growth in demand from the other emerging economies (perhaps being partially offset by declining per-capita consumption in the OECD). Where is the additional oil and gas to come from?
Canada’s land mass has been blessed with a staggering abundance of hydrocarbon resource. The total oil in place is thought to be some 1.7 trillion barrels and we have been assigned reserves of 178 billion barrels (Alberta holding 96% of that), bequeathing Canadians with the third-largest reserves in the world. With the Canadian Association of Petroleum Producers (CAPP) reporting 2011 production of approximately 2.1 million barrels of oil per day, one could argue there is more than a hundred year’s supply, even after a doubling of production, and that is with no material improvements in technology or pricing such that our reserves increase. However one looks at the scale of our resource and the potential effects of new technologies and pricing, one should conclude that there will still be plenty of oil left in Canada long after the world no longer needs it. In 1973 Sheikh Yamani of Saudi Arabia astutely stated that “the Stone Age did not end because the world ran out of stones.” This national endowment should be produced now and over the next 35-plus years while it still has value.
http://opinion.financialpost.com/2013/01/14/the-oil-sands-benefits/