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Supplying synthetic crude oil from Canadian oil sands: A comparative study of the costs and CO2 emissions of mining and in-situ recovery


  • Méjean, Aurélie
  • Hope, Chris


High crude oil prices and the eventual decline of conventional oil production raise the issue of alternative fuels such as non-conventional oil. The paper describes a simple probabilistic model of the costs of synthetic crude oil produced from Canadian oil sands. Synthetic crude oil is obtained by upgrading bitumen that is first produced through mining or in-situ recovery techniques. This forward-looking analysis quantifies the effects of learning and production constraints on the costs of supplying synthetic crude oil. The sensitivity analysis shows that before 2035, the most influential parameters are the learning parameter in the case of in-situ bitumen and the depletion parameter in the case of mined bitumen. After 2035, depletion dominates in both cases. The results show that the social cost of CO2 has a large impact on the total costs of synthetic crude oil, in particular in the case of synthetic crude oil from in-situ bitumen, due to the carbon intensity of the recovery techniques: taking into account the social cost of CO2 adds more than half to the cost of producing synthetic crude oil from mined bitumen in 2050 (mean value), while the cost of producing synthetic crude oil from in-situ bitumen more than doubles.

Suggested Citation

  • Méjean, Aurélie & Hope, Chris, 2013. "Supplying synthetic crude oil from Canadian oil sands: A comparative study of the costs and CO2 emissions of mining and in-situ recovery," Energy Policy, Elsevier, vol. 60(C), pages 27-40.
  • Handle: RePEc:eee:enepol:v:60:y:2013:i:c:p:27-40 DOI: 10.1016/j.enpol.2013.05.003

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    References listed on IDEAS

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    Cited by:

    1. Hosseini, Seyed Hossein & Shakouri G., Hamed, 2016. "A study on the future of unconventional oil development under different oil price scenarios: A system dynamics approach," Energy Policy, Elsevier, vol. 91(C), pages 64-74.

    More about this item


    Non-conventional oil; Social cost of CO2; Probabilistic model;

    JEL classification:

    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q47 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy Forecasting
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming


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