Wednesday, January 25, 2012

More on oil and gas - this time the North

Oil has been produced in Norman Wells on the Mackenzie since the 1920s and is now connected to Alberta via a pipeline.  The field produces about 5-6 million barrels of oil per year.

The estimate is that the Northwest Territories have long term recoverable oil reserves of between 1.5 billion and 5 billion barrels of oil.   The estimate of probable natural gas reserves in the Mackenzie Delta and Beaufort Sea is 1.7 trillion cubic meters, though gas hydrates may more than double that.  These are larger gas deposits than the total reserves Canada currently has.   With the construction of the Mackenzie valley gas pipeline, these gas deposits become reserves.

If we go further north, the deposits are ever larger.   The Sverdrup Basin is estimated to contain 3-7 billion barrels of conventional oil and 1.3- 3.5 trillion cubic meters of natural gas.   In the Canadian waters between Nunavut and  Kalaallisut (Greenland) are estimated at 2.5 billion barrels of oil and 700 billion cubic meters of natural gas.  The Baffin Bay reserves make it clear why Denmark and Canada care about Hans Island.   The Inuit of Kalaallisut are actively encouraging oil and gas development.

 I can not find estimates for Davis Strait or Hudson's Bay, both of which should have oil and gas.

Finally, there is the oil on Melville Island which is located in on the western edge of the Canadian arctic archipelago.  In the early 1960s it was discovered to have oil and gas, most significantly a large deposit of tar sands.   In 1966 the estimate was that these tar sands contained 100,000,000,000 barrels of oil.   I can not find more recent estimates of the size of the deposit.   This oil is currently not considered recoverable, but with all the natural gas on hand in the Sverup basin, it may not be as unrealistic as one might think with rising oil prices.  

The potential for a large scale oil and gas industry in the arctic is a realistic future.
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