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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum

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Nov 13 4:00 PM EST

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To: energyplay who wrote (6713)	5/25/2006 2:32:38 PM
From: Elroy Jetson	Read Replies (1) of 217750

The underlying economics of converting "tar sands" bitumen into crude oil depends upon the hydrogen percentage. In short, a barrel of bitumen from tar sand is worth roughly 0.69 barrels of light crude oil. I don't know the current total price of bitumen extraction and ecological recovery of the mine site, but some have mentioned a price of $28 per barrel of bitumen, or $42 per barrel of light crude oil ($28 / 0.69). Based on a light crude oil price of $74 per barrel, that's a "net back" of $30 per barrel. Obviously at a light crude price of $42, the "net back" is zero and tar sands hold only speculative value. Percentage of Hydrogen by weight 80% natural gas 15% light crude oil 12% heavy crude oil 10.4% tar sands _3% coal In order to turn tar sands into light crude oil, you need to add hydrogen, say from natural gas (or water, but that takes a lot more energy). Obviously, if tar sands were used like a sloppy form of coal, tar sands also have some value as a very dirty fuel which could be used in large furnaces. .

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