Beneath the layer of bush country that stretches from here into the Northwest Territories lie huge amounts of gooey black sands said to contain potential oil reserves greater than those in the Persian Gulf.
Until the 1973 Arab oil embargo, this river port town was the last outpost of civilization. The road and railroad ended here and trappers and fur traders depended on tugboats that took merchandise and supplies up the Athabasca River through connecting lakes and waterways all the way to Great Slave Lake and regions near the magnetic pole.
Two months later, in the midst of a winter that kept the mercury at minus 40 for weeks, men and machines began clearing the site of what today is the world's largest plant for extraction of crude oil from an abundance of raw material that looks and feels like a sandy beach hit by an enormous oil slick.
Farther north, Canadians have recently discovered both oil and gas in the Beaufort Sea and substantial natural gas deposits near Melville Island in the Arctic Ocean. These discoveries may justify a pipeline connection to southern markets, and such a multibillion-dollar project would mean an influx of money and people into this sparsely populated region.
But it is the presence of huge deposits of sand mixed with a sticky asphalt-like substance known as bitumen that holds the prospect of energy sufficiency for Canada. It already has started a change, bringing American suburbia into what was bush country only yesterday.
For the men who run the $2.1 billion synthetic oil plant known as Syncrude, the key question is whether Western technology can surmount various technical problems as well as an exceptionally difficult climate to produce 129,000 barrels of crude oil daily at competitive prices.
A larger question is whether there is business and political resolve to commit enough resources for the expansion and improvement of tar sands exploitation to offset at least partially OPEC control of world markets and encourage similar projects in the United States on a scale envisioned by President Carter.
Today, after less than a year in operation, Syncrude produces 100,000 barrels of crude daily. Yet it still operates in the red, mainly because technical difficulties kept production at 50,000 barrels a day for the first half of this year.
"We have 3,000 people working here and our overhead costs are the same whether you produce 50,000 or 100,000 barrels," Syncrude's operating chief Jim Guthrie said.
When four oil companies began building the plant, Guthrie said, they figured that they would recover their costs and make handsome profit over a 25-year period. "I'm sure that we'll do it, and I'm certain that already next year we are going to show profit," he said.
Syncrude is owned by Esso Imperial, Gulf Canada, Cities Service and Petro-Canada. The Alberta provincial government holds 10 percent interest and the Canadian federal government 5 percent interest in the venture.
A consortium of eight oil companies led by Shell Canda is planning to build a $5 billion plant near here and Calgary oilmen are speaking about 10, even 15, more plants to be built in the 1980s.
The size of crude oil reserves contained in Athabasca tar sands varies, depending on who is providing the estimates. Ian Smyth, executive director of the Canadian Petroleum Association, talked about 1.3 trillion barrels with "another trillion below."
Wayne Minion, chairman of the Alberta Petroleum Marketing Commission, spoke about 650 billion barrels, saying that there may be more than that but it would be too deep to extract. Other officials give more conservative figures, but all were much higher than, for example, the estimated Saudi Arabian reserves of 200 billion barrels.
But compared to oil in the ground, which is relatively accessible, squeezing crude oil from tar sands is a complex and costly process.
There are two ways to do it. One is simply to strip-mine tar sand near the surface and up to 200 feet below and separate bitumen from the sticky, gritty mixture by treating it with steam; the tar-like bitumen is then cracked into naptha and gas-oil vapors (which are separated and condensed) and blended into synthetic crude. This is what Syncrude is doing.
Another way of getting at oil is to use the so-called "huff and puff" method - "huff" down steam well below the surface to soften the heavy oil and then "puff" its flow upward.
Smyth said that 45 billion barrels were easily accessible through strip mining while 763 billion barrels can be recovered through the "huff and puff" method. Imperial Oil is now seeking government permission to start a "huff and puff" plant near Cold Lake, south of here, to produce 145,000 to 165,000 barrels per day.
Just how much it now costs Syncrude to produce a barrel of crude is a secret, although Guthrie and other officials concede that it is above the world price of $25. But they insist that already next year the plant will produce at below $25 per barrel, pointing out that their production prices are likely to decline over a period of years as OPEC prices continue to climb.
Also, they say, calculated in their present costs are expenditures on housing and on the amenities that are required to attract and keep people in this remote region where temperatures during long winters can plunge to minus 50 degrees or below.
High wages and massive construction have attracted thousands of people to northern Alberta. A decade ago Fort McMurray had 700 residents and only occasional contacts with the outside world. Today it is a city of 27,000 with modern hotels, a nine-hole gold course, three indoor skating rinks, a municipal pool, a sports arena and a 300-bed hospital. There are at least three scheduled flights into and out of Fort McMurray daily.
There are expensive jewelry stores here as well as a Sears, an H. & R. Block office, banks, movie houses, a Safeway, a bowling alley, a Kentucky Fried Chicken franchise and other symbols of Canadian and American life, including an ultramodern shopping center.
"When I was growing up, we never locked our doors," said Merle Rudiak, a former schoolteacher who is a native of Fort McMurray and as such a rarity. "But not anymore," she said, explaining that the growth has been accompanied by juvenile delinquency, crime and other problems.
Rudiak, who like many women here wears a gold watch with solid gold band, a large gold ring and gold earrings, works for Syncrude. The average salary at the plant is about $23,000 and workers operating heavy equipment or other machinery make as much as $50,000 to $70,000 a year with overtime, according to officials.
She conceded, a trifle grudgingly, that the sudden intrusion of the modern world and the accompanying relative wealth have not changed the basic aspects of life. But given that fact, she said, "I've been poor, I've been rich. I'd rather be rich."
The Syncrude plant itself is located so far from urban areas that its effect on the environment is little noticed. It has leased 7,000 acres of land for 25 years with the obligation to fill 200-feet-deep furrows and reclaim the area. (Three cents per barrel is set aside for reclamation purposes.)
But the plant, and others to come, will change the economics of life in a place where trapping and hunting are disappearing and where the Good Fish Indian band 15 miles from here has gone into the cleaning business as contractors for Syncrude.
To the south, in the Cold Lake area, where farming is still a marginal occupation, the people are torn between the desire for jobs and money and the preservation of their old lifestyle. With land prices increasing by more than a 1,000 percent in a year (in the West Pembina area, an acre of land went from $50 two years ago to $26,000 at the latest auction), the dice seem loaded against conservationists.
Oilmen here and in Calgary insist that environmental risks will be kept at a minimum by careful planning and that the huge requirements of water - Syncrude uses 200,000 gallons a minute - for the extraction process have already been reduced through recycling methods.
The crucial problem here, apart from technological improvements, is the vast amount of capital required to build such facilities. Syncrude cost $2.1 billion. The two current projects will cost about $5 billion each. Future plants are expected to be even more expensive.