HELP WANTED: 30,000 skilled welders, electricians and pipe fitters
With crude oil selling for over $70 a barrel, costly development of unconventional oil supplies finally appears viable. Canada, already the USA's No. 1 source of imported oil, is moving forward with plans to massively expand production of oil from giant tar-like deposits in the country's West called "oil sands."
For the United States, Canadian oil sands offer the hope of supply help from a nation far friendlier and more politically stable than traditional Middle Eastern outlets.
Daily production from oil sands is expected to quadruple to 4 million barrels by 2020, according to the Canadian Association of Petroleum Producers. An estimated 175 billion barrels of oil lie buried in the hills of western Alberta province, ranking Canada behind only Saudi Arabia in proven reserves.
But even as boom towns rise, the ambitious venture still faces some tough hurdles. Chief among them: finding about 30,000 skilled welders, electricians and pipe fitters willing to relocate to a remote corner of Canada to transform the oil sands dream into reality.
"That's probably the biggest constraint. It's a matter of, 'Can we get the people to build all these projects at the same time?' " says Neil Camarta, senior vice president for oil sands with Petro-Canada, one of several companies already at work in oil-rich Alberta province.
Oil sands development is both more difficult and labor intensive than conventional oil drilling. A portion of the oil is recovered through strip mining; deposits deeper than about 200 feet are lifted to the surface by injecting steam under high pressure to liquefy them.
About two tons of sand must be sifted to produce one barrel of oil. Once recovered, the gooey residue is heavily processed before being pumped to refineries in the USA.
Alberta Premier Ralph Klein, who was in Washington last week, met with Vice President Cheney to promote the region's oil industry. Energy Secretary Samuel Bodman is scheduled to tour the oil sands region this month.
As development accelerates, Canadian companies expect to exhaust domestic supplies of trained oil-industry craftsmen.
"I believe we will be drawing on the American workforce. Americans have the skills to build these projects," says Camarta.
Petro-Canada, boasting about 10 billion barrels of reserves, already is producing at one oil sands site and is scheduled to decide on proceeding with a second multibillion-dollar investment by the end of 2007, Camarta says.
On the New York Stock Exchange, its shares closed Monday at $48.24, up about 45% the past year.
"We're a huge reservoir of oil," says Camarta. "The limits are (finding) the people."