RE: PetroTeq!26 Sep 2019 12:33
Additionally, we are seeing technological advances in the space that look set to reduce this cost per barrel even further, as well as alleviate some of the environmental impact of oil sands processing – something that falls in line with the Paris summit agreement.
Take MCW Energy Group Limited (TO:MCW), for example. The company, run by the former Exxon (N:XOM) president of Arabian Gulf operations, has developed a technology that allows for the processing of oil sands without any water (removing the possibility of water source pollution) and which uses a solvent to separate the bitumen instead of heat (which vastly reduces greenhouse gas emission.) Because a solvent is used, the byproduct of the process is clean sand, meaning it automatically meets the ELC criteria. Further, a report conducted in 2012 suggests the technology can produce at a cost of $24 a barrel.
So what’s the takeaway here? Well, oil sands will remain controversial, there’s no question about that. However, with the latest Paris summit targeting a 2-degree cap in global temperatures, the space has an opportunity to reform its image. With technology in the sector improving the environmental impact that oil sand production has in its mining regions, and the increasingly attractive per barrel economics, oil sand is here to stay – and at a time when the entire energy sector is under real pressure from markets, there may be opportunity in some of oil sand’s constituent companies to pick up an exposure at a discount.