Investment in Western Canada's oil sands, responsible for two-thirds of the country's crude output, is waning, and it's hard to see a recovery on the horizon. Investor sentiment toward the oil industry is weak everywhere these days, but Canada carries additional risk. Its high-carbon oil sands attract significant environmental protests, while its unpredictable regulatory regime has hampered many projects. Canada's oil sands simply don't look very competitive amid a glut of global upstream opportunities in the current era of abundance, including short-cycle US shale to the south. As 2019 winds down, estimates suggest capital investment in Canada's oil sands sector for the year will be around $12 billion - down some 65% from 2014 levels, according to the Canadian Association of Petroleum Producers. Developing oil sands is a lengthy and expensive commitment, but with 167 billion barrels of reserves - behind only Saudi Arabia and Venezuela - Canada could produce oil sands barrels for many decades to come under the right circumstances (PIW May24'19). However, accessing funds needed to exploit the resource is becoming more difficult by the year.
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