Canada has about 175 billion barrels of oil that can be recovered with today’s technology, the third largest reserves of oil in the world after Saudi Arabia and Venezuela. Of that number, 170 billion barrels are located in the oil sands. Oil sands are a mixture of sand, water, clay and bitumen – oil that is too heavy or thick to flow or be pumped without being diluted or heated. Canada’s oil sands are found in three deposits: the Athabasca deposit in Alberta and part of Saskatchewan and the Peace River and Cold Lake deposits in Alberta. The largest quantity is found in the Athabasca deposit.

There are two different methods of producing oil from the oil sands: open-pit mining and in situ (Latin, meaning “in place”). Bitumen that is close to the surface is mined. Bitumen located deeper underground is produced in situ using specialized extraction techniques.

Open-pit mining is similar to many coal mining operations – large shovels scoop the oil sands into trucks that take it to crushers where the large clumps of earth are broken down for processing, various components are separated and the bitumen is ultimately upgraded into crude oil.

About 20 per cent of the oil sands can be recovered through open-pit mining. The mineable oil

sands deposits comprise only about three per cent of the total surface area underlain by oil sands. Eighty per cent of oil sands reserves (which underlie approximately 97 per cent of the total oil sands surface area) are recoverable using in situ technology with less surface disturbance.

The majority of in situ operations use steam assisted gravity drainage, or SAGD. This method involves pumping steam underground through a horizontal well to liquefy the bitumen that is then pumped to the surface through a second well. Advances in technology, such as directional drilling, enable in situ operations to drill multiple wells (sometimes more than 20) from a single location, reducing the surface disturbance.

Companies operating in the oil sands are committed to sustainable and responsible development. As Bruce March, Chairman of the Board, President and CEO of Imperial Oil said at the company’s 2010 Annual General Meeting: “Let me be clear on this point: As we move forward with our oil sands projects, we will do so in a responsible manner.”
-Mr. March’s comments are indicative of industry’s broad commitment to responsible development of Canada’s oil sands.

Industry’s commitment to responsible development is evident in ongoing advances in development and operations, in part enabled by multi-million dollar investments in research and development. With significant growth in oil sands production, there is often an increase in the absolute measures of environmental impact. Measures of intensity, or environmental impact per unit of production, are more indicative of performance trends as they normalize for production growth. Both measures are provided in this section of the report.

Note: Western Canada oil and gas operations other than oil sands are discussed in a separate section of this report and are not included in the data reported in this oil sands section.

Data Sources

Data from both CAPP members and government sources are used in this section of the report. The Government of Alberta’s data represent the Alberta oil sands industry, including data from operations of non-CAPP member companies.