TAR SANDS OIL?

There has been a lot of talk about the Canadian tar sands. Actually, there has been oil coming from them for a long time. But will these deposits, said by some to be greater than the "lakes" of oil beneath Saudi Arabia, eventually serve western civilization's addiction?

A recent report from Canada suggests the cost will be steep:

Fears growing in wake of expected 50% cost increase at Shell oilsands plant
James Stevenson, Canadian Press

CALGARY (CP) - Fears that cost pressures have spiralled out of control in the northern Alberta oilsands spooked investors Thursday in the wake of news that Shell Canada's (TSX:SHC) Athabasca oilsands project could potentially pay upwards of $11 billion to generate an extra 100,000 barrels of oil a day.

Even in an industry that has seen its share of multibillion-dollar cost overruns to build megaprojects, word that Athabasca's first major expansion could cost 50 per cent higher than the current $7.3 billion pricetag hit oilsands producers hard on the stock market.

Bob Gillon, an energy analyst with John S Herold in Connecticut, said the Athabasca expansion would now cost six times what the original project did, on a daily flowing barrel basis.

"It's not a knock on Shell or this project, everybody's facing it," Gillon said in an interview Thursday...

Once again, the question of EROEI is the crucial one. As Paul Roberts and Raymond J. Learsy among many others have articulated, Peak Oil does not mean the end of oil, it means the end of CHEAP oil.