Oil Sands

Basic
Secondary oil production concerns the extraction of oil from oil sands. Oil sands (also referred to as tar sands) are a combination of clay, sand, water and bitumen; a heavy black viscous oil. Upon extraction and refinement, the oil produced may be used, in the same way as conventional oil, in transportation, heating and power generation.
US Department of the Interior

Commodification
Oil sands may be mined and processed to extract the oil-rich bitumen, which is then refined into oil. Unlike crude oil production, oil sands are not pumped from the ground. Instead, deposits are usually mined using strip mining or open pit techniques. The oil may also be extracted using underground heating methods. The oil is then extracted from tar sands through extraction, separation and further processing methods.
US Department of the Interior

Origin
Research was conducted into oil sands production in Canada from the early 1900s. Wells were drilled between 1906 and 1917 looking for conventional crude oil resources. Mapping of the oil sands resources in Alberta was then carried out. Dr. Karl Clark of the Scientific and Industrial Research Council of Alberta, predecessor of the Alberta Research Council (ARC), was heavily involved in developing processes to separate bitumen from the sand.

Following several pilot projects, the first commercial oil sands production/separation facility was opened in 1967 in Alberta operated by Suncor. The facility produced twelve thousand barrels of oil per day. Interest in oil sands in the US dates back to the 1930s. Fifty-two pilot projects were conducted in the '60s and '70s.

In 1984, a study by the US Geological Survey (USGS) and the US Bureau of Mines identified 53.7 billion barrels of oil sands in the US. 21.6 billion barrels of this were measured, the remaining 32.1 billion barrels were speculated. Thirty-three major deposits were identified. However, production was not considered viable due to the remote and difficult topography, scattered deposits, lack of water for separation processes and undeveloped technology.
Federation of American Scientists (FAS)

Popular Use
Currently, only Canada has a large-scale commercial oil sands industry. More than 1.7 million barrels per day of synthetic oil are produced from fields in the Alberta Province. This now exceeds Canada's conventional oil production. Production levels from oil sands are increasing rapidly following recent major private sector investment.
Canadian Energy Research Institute (CERI)

Venezuela also has a major oil sands resource, however to-date there has been limited commercial production of oil sands there.
US Department of the Interior

Step 1 - Recovery
There are two methods to recover oil sands: surface mining or in-situe production. Only 20% of oil sands are recoverable through surface mining; the remaining 80% can only be recovered through in-situe production. Surface mining is used for deposits with overburden less than 75 metres thick. Mining requires a hydraulic or electric shovel that loads the sand onto 400-ton trucks.

The material is then carried to a crusher to be mixed into a slurry. The slury is "hydro transported" to an extraction facility to extract bitumen. Most in-site production comes from deposits buried more than 350-600m below the surface.
Federation of American Scientists (FAS)
Government of Alberta

Step 2 - Upgrading
Upgrading involves adding hydrogen or removing carbon from the extracted bitumen. This produces a more balanced, lighter hydrocarbon that is more valuable and easier to refine. The upgrading process also removes contaminants including heavy metals, salt, oxygen, nitrogen and sulpher. There are three main steps in the upgrading process.
Government of Alberta

Step 3 - Transportation
Currently, oil sands are moved by two major pipelines (the Athabasca and the Corridor) as diluted bitumen to processing facilities such as that at Edmonton, Canada. After the oil is refined, it is transported primarily by pipeline to the United States. Oil sands from Canada are also refined in the US.
Federation of American Scientists (FAS)

Shipping is also used to transport oil from Canada to the US. In late 2010, the Canadian National Railway of Montreal joined with Altex Energy, an oil shipping company to ship Canadian oil sands directly to the Gulf of Mexico.
New York Times
New York Times

Step 4 - Distribution
The refined oil is then distributed from the refineries. Refineries in the US are expanding their operations to meet increased volumes of Canadian heavy crude oil. The two largest refineries are operated by Exxon Mobil followed by BP and Petrovesa (PDV).
Federation of American Scientists (FAS)

Environment
Oil sands production emits more carbon dioxide then conventional crude oil production. Large quantities of gas must be burned in the processes used to separate the oil from the sand. The EU commission has proposed a greenhouse gas value of 107 grams per mega joule of fuel for oil sands compared with 87.1 grams per mega joule of fuel for conventional crude oil.
Reuters
Reuters

Health
Lobby groups in Alberta have claimed that high cancer rates in the area are related to oil sands production. A joint industry-government panel attributed health problems to the naturally occurring levels of metals. A study by the University of Alberta has found high levels of lead, zinc, cadium and other metals near oil sands mining sites or downstream of them. These levels exceeded governmental guidelines.
New York Times

Scale of Resource
Canada has approximately 175 billion barrels of proven oil sands reserves. This places it second behind Saudi Arabia in oil reserves. Oil sands production is expected to increase to 2.8 million barrels per day by 2015. A report to Congress stated that US oil sand production could reach 340,000 to 352,000 barrels per day by 2025. The US Geological Survey (USGS) estimates that a mean volume of 513 billion barrels of oil from oil sands is technically recoverable in the Orinoco Oil Belt, Venezuela, making it one of the world's largest resources of oil.
Federation of American Scientists (FAS)
US Geological Survey (USGS)

Employment
Employment in Canada as a result of new oil sands developments is expected to grow from 75,000 jobs in 2010 to 905,000 in 2035. It is predicted that for every two jobs created in Canada due to oil sands operations, one job will be created in the United States. There is also significant potential for employment as oil sands production in Venezuela develops.
Canadian Energy Research Institute (CERI)

Countries of Largest Oil Sands Reserves
1. Venezuela - 211.2 billion barrels of proven reserves. Estimates by the US Geological Survey (USGS) state that there is a mean volume of 513 billion barrels of technically recoverable oil in the country.
US Geological Survey (USGS)
US Energy Information Administration (EIA)

2. Canada - 169.9 billion barrels recoverable under current technology and knowledge.
Canadian Energy Research Institute (CERI)

3. Russia - There are significant concentrations in Eastern Siberian in the Lena-Tunguska basin. There is an estimated recoverable resource of 34 billion barrels in Russia.
European Commission - Joint Research Centre (JRC)

4. USA - The state of Utah has the largest proven oil sands reserves at 20.1 billion barrels. There are also smaller reserves in Alaska, Alabama, Texas and California.
Federation of American Scientists (FAS)