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Dilbit not Dilbert

February 09, 2013

The largest single deposit of oil in the world lies in Alberta—the oil sands. While the location of the deposit(s) of around 2 trillion barrels are known, it takes considerable technology and expertise to extract the bitumen from the oil sands. Dilbit, or diluted bitumen, is the product sent to refineries for processing.

Canada’s oil sands production is expected to increase from 1.3 M barrels per day to more than 2 M barrels of oil by 2020, mostly due to the oil sands. Yet pipeline capacity is maxed out. Canada is losing $70 M per day from its inability to sell at market prices, according to a Government of Saskatchewan initiated study.

Consider these recent developments:


There is something Dilbert-like when by far the safest way to transport dilbit, that is by pipeline, is being blocked for political reasons. The economics are such that the oil sands is a huge supply source for oil and the markets for this commodity demand more dilbit.

The environmental concerns surrounding shipping dilbit by ocean tanker are very real. Since the Exxon Valdez catastrophe however double hulled tankers and advanced nav-aids have made shipping a lot safer. Additionally, dilbit has been shipped out of Vancouver for 25 years with no spills.



Source: http://en.wikipedia.org/wiki/Oil_sands