BP’s oil disaster in the Gulf of Mexico brings home some of the dangers and risks of deep offshore drilling and production. Nothing so deep has blown out before; and similar fields are being readied for production from deposits five kilometres below the waves hundreds of kilometres offshore Brazil and Western Africa. The offshore drilling industry had earned a good reputation considering the risks involved. But now it doesn’t bode well for unconventional oil in unconventional places—which the world and especially the US are increasingly becoming reliant upon. With no signs any time soon that the planet’s population will be weaned off petroleum energy, Canada’s oil sands are looking less and less noxious in comparison.
The oil sands of Alberta and Saskatchewan contain the world’s second largest recoverable reserves of crude oil—at least 175 billion barrels of it at today’s prices and technological expertise. And that’s just ten percent of the total in the ground. Exploration risk is zero, as deposits are well known and well defined. Production risks are quantifiable and predictable. And although under some (misleading) fire from environmental organizations, impacts are manageable. Compare the looming environmental catastrophe in the Gulf of Mexico with the 0.5% of world greenhouse gas emissions coming out of the oil sands.
The catastrophic BP spill will shut down or suspend much offshore activity, reducing projected supply and, unless world demand drops, putting upward pressure on world oil prices. As prices climb, more production from the oil sands will become economic (it’s expensive to produce: Shell recently said they’ve put new expansion plans on hold until prices are consistently above US75 per barrel).
In his newly-released book Black Bonanza: the Race to Secure North America’s Energy Future, noted historian and publisher Alastair Sweeny sees Canada’s vast oil sands resource as a calming, stabilizing force in the world. It’s a force that offers “energy security and a bridge between petroleum-based economies and alternative energy sources,” he writes. It’s a bridge that seems much safer than gambling with the deep offshore.