Forecasting Oil Sands Development Using a Granular Operator and Phase-Level Approach

Abstract

The oil sands holds over 170 billion barrels of estimated recoverable bitumen. The prize is massive but many limitations will dictate how, when and whether these resources leave the ground. We track activity from 50 companies active in the oil sands sector that have various interests in 117 named projects across 5,600+ active leases. These projects combine for 58.8 billion barrels of produced or commercially recoverable bitumen and 98.5 billion barrels held in our contingent project category. When assessing which projects to include in a commercial outlook, it is important to first establish limitations and key success determinants. With the cost of oil sands development, one of these is the leaser's ability to raise development capital and where that project sits in their global or regional portfolio of opportunities. But that is one of many considerations. The geological parameters (producible pay, cap rock integrity or the presence of shale baffles or water lean zones for steam-assisted gravity drainage (SAGD) or stripping ratio and ore grade quality for mines) will dictate the development options and resulting economics of a given project. Other factors like access to infrastructure and planned adaptation of technological innovations also complicate project-to-project comparisons and how to weight which projects go ahead when. This paper will demonstrate how we construct commercial models for individual project phases, balancing project geologic data with corporate metrics and market limitations to determine what fits in a granular outlook. The geology, reserve and company data built for this project view also reveals a diverse project landscape with a wide mix of development types and sizes. This allows us to touch on how our market access views impact granular forecasts but also to provide a high level view of the novel use of solvent applications, modular designs or entirely new development methods that are currently proposed in the project queue. Case studies could include the economic impacts of Solvent Aided Process at Narrows Lake while highlighting other pilots and technology demonstrations (THAI, ESEIEH, UltraLite/1nSite facility installation, VSD, C2C-SAGD, to name a few). We currently attribute US$341 billion in remaining value (government share and company) to commercially viable projects that use today's technologies. But it's the future technological advancements that will determine how more could come and who will hold the reins.

AAPG Datapages/Search and Discovery Article #90259 ©2016 AAPG Annual Convention and Exhibition, Calgary, Alberta, Canada, June 19-22, 2016