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January 31, 2006

Oil sands

As the price of oil has increased we’ve heard more discussion about alternative energy sources such as oil sands. But what are oil sands, and are they the answer to high oil prices? N.C. State University's Mike Walden weighs in.

"Oil sands are essentially oil trapped in a mixture of sand, clay and water," says Dr. Walden, a professor and extension economist with the Department of Agricultural and Resource Economics.

"The supply is immense," he says. "Canada alone has enough oil in oil sands to satisfy world oil demand for 80 years.

"But there are some issues: First of all, getting the oil out of the oil sands is very expensive. There’s billions of dollars needed in capital investments," he says.

"Also it does take a large amount of energy, including water, to extract the oil from the sands. And then there are environmental issues: You have to obviously cut up and dig in the environment.

"But the investment in oil sands is increasing, and this may be a major source of oil for us down the road."

Posted by deeshore at January 31, 2006 08:00 AM