Canada has the third-largest oil reserves in the world. With 170 billion barrels of oil that can be recovered economically with today’s technology, 164 billion barrels, or 96 per cent of Canada’s oil reserves are located in the oil sands. (Source: AER, 2017 and Oil and Gas Journal, 2017)
Oil sands are a natural mixture of sand, water and bitumen (oil that is too heavy or thick to flow on its own). The oil sands are found in three regions within the provinces of Alberta and Saskatchewan: Athabasca, Cold Lake and Peace River, which combined cover an area more than 142,000 square kilometres. The oil sands are located at the surface near Fort McMurray, but deeper underground in other regions. The active mining footprint is only 901 square kilometres.
Production from Canada’s oil sands has been conducted for almost five decades. Oil sands are recovered using two main methods: drilling (in situ) and mining. The method used depends on how deep the reserves are deposited.
Of all oil sands reserves, 80 per cent are too deep to be mined. These reserves are recovered in place, or “in situ”, by drilling wells. Drilling methods create minimal land disturbance and do not require tailings ponds.
About 20 per cent of the oil sands reserves are located close enough to the surface to be mined using large shovels and trucks.
New technology and innovation are critical to developing the oil sands and improving environmental performance. Oil sands operators must adhere to stringent regulations. Approvals from numerous regulatory agencies are required at every phase, from construction and operations to decommissioning and reclamation.
As oil sands development evolves with improving technology, industry understands that it needs to continuously demonstrate that the land, air and water impacts of mining and in situ oil sands production are managed in a sustainable way to meet regulatory requirements and stakeholder expectations. Industry is also committed to providing a safe workplace for employees, contractors and the communities where it operates.
Light Tight Oil
Light tight oil (LTO) is found throughout much of the Western Canadian Sedimentary Basin (WCSB), but also in central and eastern Canada. It has more energy per unit than conventional oil, and less carbon intensive so it requires less processing than conventional oil.
LTO is found deep below the earth’s surface, primarily within low permeability sandstone and mudstone reservoirs, commonly known as shale.
The Canadian regions with tight oil reservoirs are shown the map below:
- Bakken Formation (AB, SK, MB)
- Cardium (AB)
- Viking (AB, SK)
- Lower Shaunavon (SK)
- Beaverhill Lake Group (AB)
- Exshaw (BC, AB)
- Lower Amaranth (MB)
- Macasty (Anticosti) (QC)
- Green Point (NL)
- Canol (NT)
- Montney/Doig (BC, AB)
- Duvernay/Muskwa (AB)
(Source: NGI’s Map of North America Shale/Resource Plays)
As with shale gas, the first shale oil reservoirs were completed in the 1800’s but they received very little attention until 2008. The Bakken shale oil play located in Canada and the U.S. was first developed in the 1950’s but did not begin to boom, from new completion techniques, until 2007.
LTO is recovered through two processes: horizontal drilling and hydraulic fracturing.
Technological innovation and the increasing efficiency of horizontal drilling and hydraulic fracturing processes are unlocking vast tight hydrocarbon resources and transforming the natural gas and LTO industry in North America. The combination of these two technologies has given new life to previously low-producing or unproductive oil reservoirs in the Western Canadian Sedimentary Basin (WCSB).