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Unconventional oil is petroleum produced or extracted using techniques other than the conventional method (oil well). Industry and governments across the globe are investing in unconventional oil sources due to the increasing scarcity of conventional oil reserves. Unconventional oil and gas have already made a dent in international energy linkages by reducing US energy import dependency.[1]

Sources

According to the International Energy Agency's (IEA) World Energy Outlook 2001[2] unconventional oil included "oil shales, oil sands-based synthetic crudes and derivative products, (heavy oil, Orimulsion®), coal-based liquid supplies, biomass-based liquid supplies, gas to liquid (GTL) - liquids arising from chemical processing of gas."[3]

In the IEA's World Energy Outlook 2011 report, "[u]nconventional oil include[d] extra-heavy oil, natural bitumen (oil sands), kerogen oil, liquids and gases arising from chemical processing of natural gas (GTL), coal-to-liquids (CTL) and additives."[4]

Definition

In their 2013 webpage jointly published with the Organisation for Economic Co-operation and Development (OECD), the IEA observed that as technologies and economies change, definitions for unconventional and conventional oils also change.[5]

Conventional oil is a category that includes crude oil - and natural gas and its condensates. Crude oil production in 2011 stood at approximately 70 million barrels per day. Unconventional oil consists of a wider variety of liquid sources including oil sands, extra heavy oil, gas to liquids and other liquids. In general conventional oil is easier and cheaper to produce than unconventional oil. However, the categories “conventional” and “unconventional” do not remain fixed, and over time, as economic and technological conditions evolve, resources hitherto considered unconventional can migrate into the conventional category.

— IEA 2013

According to the US Department of Energy (DOE), "unconventional oils have yet to be strictly defined."International Energy Agency's (IEA) World Energy Outlook 2001[2] unconventional oil included "oil shales, oil sands-based synthetic crudes and derivative products, (heavy oil, Orimulsion®), coal-based liquid supplies, biomass-based liquid supplies, gas to liquid (GTL) - liquids arising from chemical processing of gas."[3]

In the IEA's World Energy Outlook 2011 report, "[u]nconventional oil include[d] extra-heavy oil, natural bitumen (oil sands), kerogen oil, liquids and gases arising from chemical processing of natural gas (GTL), coal-to-liquids (CTL) and additives."[4]

Definition

In their 2013 webpage jointly published with the Organisation for Economic Co-operation and Development (OECD), the IEA observed that as technologies and economies change, definitions for unconventional and conventional oils also change.[5]

Conventional oil is a category that includes crude oil - and natural gas and its condensates. Crude oil production in 2011 stood at approximately 70 million barrels per day. Unconventional oil consists of a wider variety of liquid sources including oil sands, extra heavy oil, gas to liquids and other liquids. In general conventional oil is easier and cheaper to produce than unconventional oil. However, the categories “conventional” and “unconventional” do not remain fixed, and over time, as economic and technological conditions evolve, resources hitherto considered unconventional can migrate into the conventional category.

— IEA 2013

According

In the IEA's World Energy Outlook 2011 report, "[u]nconventional oil include[d] extra-heavy oil, natural bitumen (oil sands), kerogen oil, liquids and gases arising from chemical processing of natural gas (GTL), coal-to-liquids (CTL) and additives."[4]

In their 2013 webpage jointly published with the Organisation for Economic Co-operation and Development (OECD), the IEA observed that as technologies and economies change, definitions for unconventional and conventional oils also change.[5]

Conventional oil is

Conventional oil is a category that includes crude oil - and natural gas and its condensates. Crude oil production in 2011 stood at approximately 70 million barrels per day. Unconventional oil consists of a wider variety of liquid sources including oil sands, extra heavy oil, gas to liquids and other liquids. In general conventional oil is easier and cheaper to produce than unconventional oil. However, the categories “conventional” and “unconventional” do not remain fixed, and over time, as economic and technological conditions evolve, resources hitherto considered unconventional can migrate into the conventional category.

— IEA 2013

According to the US Department of Energy (DOE), "unconventional oils have yet to be strictly defined."[6]

In a communication to the UK entitled Oil Sands Crude in the series The Global Range of Crude Oils,In a communication to the UK entitled Oil Sands Crude in the series The Global Range of Crude Oils,[7] it was argued that commonly used definitions of unconventional oil based on production techniques are imprecise and time-dependent. They noted that the International Energy Agency does not recognize any universally accepted definition for "conventional" or "unconventional" oil. Extraction techniques that are categorized as "conventional" use "unconventional means" such as gas re-injection or the use of heat" not traditional oil extraction methods. As the use of newer technologies increase, "unconventional" oil recovery has become the norm not the exception. They noted that the Canadian oil sands production "pre-dates oil production from areas such as the North Sea (the source of a benchmark crude oil known as "Brent").[7]

Under revised definitions, petroleum products, such as Western Canadian Select,[8] a heavy crude benchmark blend produced in Hardisty, Alberta may migrate from its categorization as unconventional oil to conventional oil because of its density, even though the oil sands are an unconventional resource.

Oil sands generally consist of extra heavy crude oil or crude bitumen trapped in unconsolidated sandstone. These hydrocarbons are forms of crude oil that are extremely dense and viscous, with a consistency ranging from that of molasses for some extra-heavy oil to as solid as peanut butter for some bitumen at room temperature, making extraction difficult. These heavy crude oils have a density (specific gravity) approaching or even exceeding that of water. As a result of their high viscosity, they cannot be produced by conventional methods, transported without heating or dilution with lighter hydrocarbons, or refined by older oil refineries without major modifications. Such heavy crude oils often contain high concentrations of sulfur and heavy metals, particularly nickel and vanadium, which interfere with refining processes, although lighter crude oils can also suffer from sulfur and heavy metal contamination. These properties present significant environmental challenges to the growth of heavy oil production and use. Canada's Athabasca oil sands and Venezuela's Orinoco heavy oil belt are the best known example of this kind of unconventional reserve. In 2003 the estimated reserves were 1.2 trillion barrels (1.9×1011 m3).[9]

Heavy oil sands and bituminous sands occur worldwide. The two most important deposits are the Athabasca Oil Sands in Alberta, Canada and the Orinoco heavy oil belt in Venezuela. The hydrocarbon content of these deposits is either crude bitumen or extra-heavy crude oil, the former of which i

Heavy oil sands and bituminous sands occur worldwide. The two most important deposits are the Athabasca Oil Sands in Alberta, Canada and the Orinoco heavy oil belt in Venezuela. The hydrocarbon content of these deposits is either crude bitumen or extra-heavy crude oil, the former of which is often upgraded to synthetic crude (syncrude) and the latter of which the Venezuelan fuel Orimulsion is based. The Venezuelan extra heavy oil deposits differ from the Canadian bituminous sands in that they flow more readily at Venezuela's higher reservoir temperatures and could be produced by conventional techniques, but the recovery rates would be less than the unconventional Canadian techniques (about 8% versus up to 90% for surface mining and 60% for steam assisted gravity drainage).[10]

In 2011, Alberta's total proven oil reserves were 170.2 billion barrels representing 11 percent of the total global oil reserves (1,523 billion barrels) and 99% of Canada's oil reserves. By 2011 Alberta was supplying 15% of the United States crude oil imports, exporting about 1.3 million barrels per day (210,000 m3/d) of crude oil.[10] The 2006 projections for 2015, were about 3 million barrels per day (480,000 m3/d). At that rate, the Athabasca oil sands reserves would last less than 160 years.[11] About 80 percent of Alberta's bituminous deposits can be extracted using in-situ methods such as steam assisted gravity drainage and 20 percent by surface mining methods.[10] The Northern Alberta oil sands in Athabasca, Cold Lake and Peace River areas contain an estimated 2 trillion barrels (initial volume in place) of crude bitumen and extra-heavy oil of which 9 percent was considered recoverable using technology available in 2013.[10]

It is estimated by oil companies that the Athabasca and Orinoco sites (both of similar size) have as much as two-thirds of total global oil deposits. They have only recently been considered[by whom?] proven reserves of oil. This is because oil prices have risen since 2003 and costs to extract oil from these mines have fallen. Between 2003 and 2008, world oil prices rose to over $140, and costs to extract the oil fell to less than $15 per barrel at the Suncor and Syncrude mines.[citation needed]

In 2013, crude oil from the Canadian oil sands was expensive oil to produce, although new US tight oil production was similarly expensive. Supply costs for Athabasca oil sands projects were approximately US$50 to US$90 per barrel. However, costs for Bakken, Eagle Ford and Niobrara were higher at approximately US$70 to US$90, according to 135 global oil and gas companies surveyed reported by the Financial Post.[12]

Extracting a significant percentage of world oil production from these deposits will be difficult since the extraction process takes a great deal of capital, human power and land. Another constraint is energy for project heat and electricity generation, currently coming from natural gas, which in recent years has seen a surge in production and a corresponding drop in price in North America. With the new supply of shale gas in North America, the need for alternatives to natural gas has been greatly diminished.

A 2009 study by CERA estimated that production from Canada's oil sands emits "about 5–15% more carbon dioxide, over the "well-to-wheels" lifetime analysis of the fuel, than average crude oil."[13] Author and investigative journalist David Strahan that same year stated that IEA figures show that carbon dioxide emissions from the tar sands are 20% higher than average emissions from oil.[14]

Tight oil, including light tight oil (sometimes confusingly the term 'shale oil' is used instead of 'light tight oil') is crude oil contained in petroleum-bearing formations of low permeability, often shale or tight sandstone.[15] Economic production from tight oil formations requires the same hydraulic fracturing and often uses the same horizontal well technology used in the production of shale gas. It should not be confused with oil shale, which is shale rich in kerogen, or shale oil, which is synthetic oil produced from oil shales.[16][17] Therefore, the International Energy Agency recommends to use the term "light tight oil" for oil produced from shales or other very low permeability formations, while World Energy Resources 2013 report by the World Energy Council uses the term "tight oil".[17][18]

Oil shale