Squeezing oil from stones

There are vast reserves of oil trapped within Alberta’s rockbed – the trick is getting it out

CALGARY — OSUM Oil Sands Corp. believes it might have the answer to one of the oil patch’s most perplexing problems – extracting the billions of barrels of crude trapped in Alberta’s limestone deposits.
To date, energy companies have largely concentrated on producing crude from Alberta’s oil sands, where tar-like bitumen is extracted from sandstone and dirt using either mining or steam-assisted extraction. While the province’s limestone deposits – or carbonates – also hold vast amounts of crude, the reserves are too deep for mining and are frequently perceived as being incompatible with steam-assisted extraction, preventing easy recovery.

Nevertheless, the uncertainty over extraction hasn’t stopped some enterprising firms from snapping up leases in regions such as Alberta’s Grosmont formation. Last year, Royal Dutch Shell PLC paid $465-million for 10 parcels of land in the carbonate region, by far the biggest outlay for staking any exploration claim anywhere in the oil sands, while Husky Energy Inc. also holds substantial acreage in the area.

The only other company to own holdings in the region is the far smaller, privately held OSUM, which used to offer technological and service solutions to other firms before deciding to acquire a slice of the oil sands itself, paying just over $20-million last August for leases that could hold 840 million barrels of recoverable crude.

Not only does the Calgary-based company believe the land can support a project ultimately capable of producing 75,000 barrels of crude a day, it believes the carbonates could be the way forward for Canada’s oil patch.

Globe and Mail