What is Peak oil?
"The term Peak Oil refers to the maximum rate of the production of oil in any area under consideration, recognising that it is a finite natural resource, subject to depletion."
--Colin Campbell
Oil Sands projects ‘need oil prices over $100’
Submitted by Mikael Höök on Mon, 2008-09-22 08:53.
New oil sands mine projects need crude prices to remain over $100 a barrel to turn a decent profit, analysts at UBS Securities said following Petro-Canada's announcement last week that costs for its planned Fort Hills project had soared by more than half.
Inflation has been the oil sands' hobgoblin, with the costs of some projects doubling as the price of steel and other materials has skyrocketed and companies find it difficult to find skilled labour pool in remote northern Alberta.
Where oil prices of $75 a barrel had been adequate to ensure a good profit, UBS-analyst Andrew Potter said $100 a barrel is now likely needed to produce a 10% return. Others estimates are even higher, with William Lacey, an analyst with FirstEnergy Capital, forecasting that the Fort Hills project will need crude at $115 a barrel.
Read more: Upstream Online
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