Oil sands production in Canada today is 1.5 million barrels per day — more oil than Libya exported before its civil war. Canadian oil sands output could double to 3 million barrels per day by the beginning of the next decade. This increase, along with its other oil output, would make Canada a larger oil producer than Iran — becoming the world’s fifth largest, behind Russia, Saudi Arabia, the United States and China.
The oil sands have become particularly controversial because of environmental groups’ vigorous opposition to the proposed 1,700-mile Keystone XL pipeline, which would carry oil from Alberta to the Texas coast. The pipeline is waiting for the Obama administration to say “yea” or “nay.” Though large, it would increase the length of the oil pipeline network in the United States by just 1 percent.
The main reason given for the opposition is the carbon dioxide associated with oil sands production, but the impact of this should be considered in the context of the overall release of CO2. When measured all the way from “well to wheels” — that is, from production to what comes out of an auto tailpipe — oil sands average 5 to 15 percent more carbon dioxide than the average barrel of oil used in the United States. And this country uses other streams of oil that generate CO2 in the same range.
Even while the environmental argument rages, oil sands are proving to be a major contributor to energy security. Although it is easy to assume that most U.S. oil imports come from the Middle East, the largest individual share by far — nearly a quarter of the total — comes from Canada, part of a dense network of economic ties that makes Canada the United States’ largest trading partner. More than half of Canada’s oil exports to the United States come from oil sands, and that share will rise steeply in the years ahead.
At the other end of that hemispheric oil axis is Brazil. When Brazil began to develop ethanol from sugar in the 1970s, it did so based on the conviction that the country had no oil. As it turns out, Brazil has lots of oil. Just the increase in Brazilian oil production since 2000 is more than
one and a half times greater than the country’s entire ethanol output.
In the middle of the last decade, new breakthroughs in technology made possible the identification and development of huge oil resources off the southern coast of Brazil that until then had been hidden below a belt of salt a mile thick. The salt had rendered unreadable the seismic signals necessary to determine whether oil was there. “The breakthrough was pure mathematics,” said Jose Sergio Gabrielli de Azevedo, the president of Petrobras, Brazil’s national oil company. “We developed the algorithms that enabled us to take out the disturbances and look right through the salt layer.” Once discovered, further technical advances were required to cope with the peculiarities of the salt layer, which, sludge-like, keeps shifting.