1. Kalina Scherbel December 4, 2003 North American Tar Baby: Draining the Alberta Oil Sands

2. OVERVIEW Oil sand & bitumen Location Abundance Comparisons to the world market Positive Implications

3. WHAT ARE OIL SANDS? Also known as tar sands Sand and other rock material which contains a heavy oil called bitumen Oil sand is composed of approximately 70% sand and clay, 10% water, and anywhere from 0% to 18% oil. The sand is a silica quartz and is extremely abrasive Each grain of sand is surrounded by a film of water, which is then surrounded by oil The sands are held firmly together by grain to grain contact.

4. BITUMEN: A STICKY SUBJECT heavy black viscous oil  thick, sticky form of crude oil  much like cold molasses must be rigorously treated to convert it into an upgraded crude oil before it can be used by refineries to produce gasoline and diesel fuels is processed to make gasoline, fuel for our homes, and petroleum chemical products like plastics, fleece and even toothpaste

5. WHERE ARE THEY LOCATED?

6. HOW MUCH IS THERE? An estimated 1.6 trillion barrels of oil was approximated as the initial deposit Covers approximately 140,800 square kilometers (84,480 square miles) 178 billion barrels are recoverable with today’s technology  740,000 barrels are produced daily 315 billion barrels may someday be recovered with advanced technology Alberta's oil sands comprise one of the world's two largest sources of bitumen; the other is in Venezuela

8. HOW ACCESSIBLE IS IT? Approximately 10% of the oil is close enough to the surface to extract using surface mining techniques The remaining oil, that comprises the bulk of it, will have to be extracted using in situ processes or vapor recovery extraction

9. HOW DOES IT COMPARE WORLDWIDE? $28 to $31 per barrel of crude oil from oil sands $25 to $32 per barrel from the world supply

10. HOW DOES IT COMPARE TO THE DOMESTIC MARKET? Domestic oil currently ranges from $20 to $24 per barrel

11. WHAT ARE THE ENVIRONMENTAL IMPLICATIONS? Land  Open pit mines  The mine plan must commit to return the area to it's former environmental condition  reclamation returns the disturbed land to a biological state that is just as, or even more, productive than it was before it was disturbed

12. Air  sulfur dioxide, carbon dioxide, nitrogen oxides, and water vapor  programs in place that measure the impact of sulfur dioxide emissions on the surrounding vegetation Water  water is recycled and reused within the plant sites to reduce the amount of water being drawn out, and to prevent pollution of surrounding fresh water lakes and rivers BEFORE AFTER

13. HOW BIG OF AN ASSET IS CANADIAN OIL TO THE U.S.? Oil sands supply approximately 9% of the daily US crude oil supply Each delayed or cancelled oil sands project means more dependence on Russia, Mexico, or OPEC members, increasing the possibility of disruptions because of political unrest or terrorist activity Common business practices, buried pipelines, and provisions in the North American Free Trade Agreement that govern energy mean this country is the most secure source of oil for the U.S

14. CLOSER TO HOME…

15. IN SUMMARY… ECONOMICALLY BENEFICIAL FOR U.S. AND CANADA POLITICALLY SOUND LOCAL RESOURCE ABUNDANT