Alberta is about to get wildly rich and powerful :: MacLeans
People respond to incentives

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"The oil sands give Canada one of the single greatest advantages of any state in the Western world," says Paul Chastko, a University of Calgary historian who recently published a book called Developing Alberta's Oil Sands. "It gives Canada the ability to supply all of North America for the next 50 years without touching a drop of imported oil."
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The National Energy Board estimates there are approximately 1.6 trillion barrels of crude bitumen saturating the ground in northern Alberta. Bitumen -- a form of heavy, thick oil laden with sulphur and deficient in hydrogen -- can be refined into synthetic crude oil to make everything from gasoline to plastics. It is the lifeblood of every industrialized economy. According to the Alberta Energy and Utilities Board, about 178 billion barrels of bitumen are economically recoverable using existing technology -- enough to produce more than 150 billion barrels of crude.

If these estimates are accurate, Canada's oil reserves rank second behind only Saudi Arabia's 260 billion barrels. And there are many who believe the current oil sands assessments understate the true potential here. The AEUB has projected that rising prices and improved technology could ultimately push the oil sands yield close to 300 billion barrels, which would make it the richest petroleum field in the world. By 2015, the oil sands are expected to be producing roughly three million barrels of petroleum a day. Assuming prices will average US$40 a barrel (well below where they are today), that suggests annual revenues of close to US$43 billion.

Last year alone, Alberta collected almost $900 million in oil sands royalties, and the Athabasca Regional Issues Working Group, an industry association, estimates that provincial revenues will hit $3 billion a year by 2011.
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"How can you not be optimistic with these commodity prices?" George [Rick George, the president and chief executive of Suncor] says. "And look, prices aren't going to stay this high. There will be volatility. But even with oil in the mid-US$30s, this industry and Suncor will perform very well."

The Canadian tar sands are one reason I don't think oil will reach $100 per barrel in the next 10 years.