Oil sands report warns of investor risk
Oil sands companies could soon run out of water and, in years to come, find themselves with a shrinking market for their product, according to grim new research.
Under current expansion plans, companies could run out of adequate winter water supplies as early as 2014, estimates the report, which was prepared for Boston-based investor and environmental advocacy group Ceres.
In coming years, rising construction costs could join with carbon tariffs to make new projects unprofitable at double-digit oil prices, the report says.
Industry believes solutions lie in new technologies under development, and says current oil sands investments are responsible. But the report contemplates a worst-case scenario that would see the entire United States adopt low-carbon fuel rules. If that happens, demand for oil sands crude – which has a higher carbon content than conventional crudes – could fall below the two million barrels a day expected from projects now operational or under construction. Read More