French energy giant Total says it is writing off $9.3-billion worth of oilsands assets in Alberta and cancelling its membership in the Calgary-based Canadian Association of Petroleum Producers.
Total now considers oil reserves with high production costs that are to be produced more than 20 years in the future to be “stranded” given its carbon reduction targets and because the resource may not be produced by 2050, the Paris-based company said Wednesday.
Getting oil out of the ground is an expensive process.
Oil is also on its way out. In many nations around the world, All new vehicles must be electric. Its so expensive right now for the return, that it actually isn’t worth it long term, knowing that, oil is on its way out.
WTI is like 42 USD, WCS is 33. 9 USD cheaper, and people still don’t want it, and it is historically not profitable to the Producer until WTI hits 70 USD, because then the WCS Sludge become profitable.
Gambling on the fact that the Tars Sands will never recover, in part because oil will never recover.
Its a dying industry, sure it will always have its uses, but fuel (specifically Gasoline), the big money one…is just a dead industry.
Edit: oh also they get some pretty good tax deductions for decreasing their net carbon footprint. Axing a current non-profitable investment, with a bleak future, and a much more popular “free” competition (Green Energy Powering Electric Cars. For a consumer price of course). They probably save more in Taxes than it cost them to get out, or at least recoup a big chunk of it.
So its win win really.