Where Oil Is Mined, Not Pumped

Though profitability has improved, making oil out of the oil sands can be less lucrative than traditional oil development. Oil-sands production also requires spending money in different ways. With normal oil production, companies have to invest heavily in exploration and sometimes drill wells that come up dry. With oil sands, companies spend very little on exploration -- the soil here is loaded with bitumen -- but must devote large amounts of money to remove the deposits from the ground and change it into crude oil.

The pickup in production transformed Fort McMurray from a remote hamlet to a thriving city with more than 55,000 residents. The demand for skilled workers is so high that some companies are importing them from as far away as South Africa.

Some companies would like to invest more but are constrained by a tight labor market, logistical complications and sophisticated machinery that takes years to build. Companies are lobbying for improved roads, affordable housing and other government services they say are needed to support expansion.

"The industry is growing as fast as it can," said James E. Carter, president of Syncrude Canada Ltd., which started producing from the oil sands here in 1978.

On a recent day at Syncrude, the giant trucks rumbled through pits, the earth heaving from their weight. Fully loaded, some of the trucks weigh more than two Boeing 747 airplanes.

"It feels like you're driving a boat," said Lisa Goldie, who sat in the driver's seat of a truck, punching information into computer displays on the dashboard. Smaller vehicles fly bright orange flags above them so the huge trucks don't run them over.

The trucks haul away the top layers of dirt, exposing the espresso-colored oil sands. The sands are then collected and sent to processing facilities that separate the bitumen. It typically takes two tons of oil sands to produce one barrel of crude, which is 42 gallons. The companies move about 1 million tons of earth a day.

In other locations, the oil sands are buried too far below the surface for mining. To reach them, steam can be injected underground to loosen the bitumen and allow it to flow though wells to the surface.

The companies say they plan to eventually fill all the pits and are planting trees. But they say the waste ponds -- filled with water, sand and petroleum byproducts -- will take years to settle.

Officials of the government agency Environment Canada said in a recent interview that in the past five years, they have taken 21 enforcement actions against oil-sands companies for such violations as releasing prohibited contaminants into the air and water.

Officials said the scale of the projects is unprecedented and they do not fully know what the environmental impact will be. "Nothing has been done on his scale before," said Robert Moyles, an agency spokesman. "The record to date is that it is being done in an environmentally responsible way."

Environmentalists complain that the mining pollutes the air and water and that companies huge amounts of clean-burning natural gas are used in the process of converting the oil sands into crude. Natural gas is in short supply in the United States, where prices have risen in recent years.

"Why are we taking this clean fuel and using it to create something really ugly," said Stephen Hazell of the Sierra Club of Canada. "Does Canada really want to be the tar nation? That's not the way to go. Not if we want to have a livable planet in 100 years."

The Alberta provincial government could not be more pleased with oil sands. The operations are bringing thousands of high-paying jobs to the region, and the companies have to pay royalties to the government.

In Fort McMurray, the impact of oil sands is laced through the city. More than half the population is connected to the industry. Visitors to the city's hotels often find a trail of mud footprints left by contractors working in the operations. Guests might end up at the Oil Sands Hotel or the Oil Can Tavern.

As the population booms and people move here from other countries, the flavor of the city also is changing. To cater to the culinary needs of the new arrivals, Annelies Geisler opened a store called the Import Connection, which sells food from around the world. The Latin American section includes bottles of yellow hot pepper and the South African section includes cans of guava halves.

Geisler has been expanding sections to match the changing population. "We're all here because of the oil sands," she said.