Cold comfort

Anybody remember the gushing (pun intended) story on 60 Minutes a few months ago about how the Candian oil sand reserves would solve all of our energy problems?

There’s an oil boom going on right now. Not in Saudi Arabia or Kuwait or any of those places, but 600 miles north of Montana.

In Alberta, Canada, in a town called Fort McMurray where, in the dead of winter, the temperature sometimes zooms up to zero.

The oilmen up there aren’t digging holes in the sand and hoping for a spout. They’re digging up dirt — dirt that is saturated with oil. They’re called oil sands, and if you’ve never heard of them then you’re in for a big surprise because the reserves are so vast in the province of Alberta that they will help solve America’s energy needs for the next century.

Within a few years, the oil sands are likely to become more important to the United States than all the oil that comes to us from Saudi Arabia.

I remember seeing it, and being more than a little skeptical, and thinking it was grossly irresponsible for CBS to join the cheerleading for maintaining our spendthrift status quo.

It seems CBS was indeed full of a dark brown substance albeit one that is not petroleum-based.

Wired Magazine's Autopia reports that

according to Western Oils Sands, one of the major players in the oil sands project, the cost of extracting the oil is "skyrocketing." The cost of its project jumped 50 percent over the previously estimated bill of $7.3 billion, thanks to increasing costs of labor and supplies. Competitor Nexen says its oil sands costs will rise 10 percent, while Shell says the cost of its oil sands plant went up 50 percent.

According to Western, oil sands are a mixture of sand, bitumen and water. Bitumen is a heavy viscous crude oil that contains high amounts of sulfur. Bitumen can be processed into high quality, synthetic oil.

The environmental cost is also steep, as Al Gore told Rolling Stone that "four metric tons of landscape is torn up for every barrel of oil."

So while there may be lots of oil in the sand, it won't come cheaply.

The $200 fill-up is coming.