FORT MCMURRAY, CANADA—The Aurora Mine exudes the odor of petroleum and the look of untapped riches.
The open pit mine plunges 250 feet deep and ranges over a couple of square miles, carved out of pine and spruce forest by gigantic machines that operate 24/7, even in the dark of winter at 40 below zero.
The unusual deposits — where oil is locked in the tarry soil rather than pooled beneath the surface — are yielding a bonanza of investment dollars, government revenue and jobs.
Almost half of Canada's oil production comes from the oil sands — and the energy industry estimates that enough oil can be economically extracted to fill the country's needs for three centuries.
The vast majority of Canadian oil exports goes to the United States, and the Bush administration sees the remaining resources as America's best hope for reducing dependence on Middle Eastern oil.
"No single thing can do more to help us reach that goal than realizing the potential of the oil sands," Energy Secretary Samuel Bodman said during a visit last July.
The benefits may be great, but the toll on other natural resources is also enormous.
Separating petroleum from sand burns so much natural gas that the enterprise is becoming the largest source of greenhouse gas emissions growth in Canada. The oil sands lie within a major intact ecosystem, the boreal forest covering almost a third of Canada's land mass.
The forest is one of the world's biggest freshwater storehouses and absorbs a vast amount of carbon dioxide. It also provides habitat for hundreds of species of birds and is home to caribous, wolves and bears. Expansion of the oil sands operations could tear huge holes in a forest already rent by logging, oil and gas exploration and other industries.
With development expected to triple, or even quintuple, in the next few decades, producers and government officials puzzle over how to harness the oil sands' potential with less cost to the climate, land, water and the well-being of native peoples who fear that cancer cases in a downstream community may be a sign of lethal industrial pollution.
Current leases for open-pit mining cover an area several times the size of New York City, according to the Pembina Institute, an environmental research group in Alberta. But more than 50,000 square miles is potentially available for various types of oil extraction, which has prompted environmentalists to call for stopping development until ecological effects can be reduced.
"The very nature of oil sands means that developing them causes an incredible disruption to land and landscape over immense areas," said a March report by the House of Commons natural resources committee.
Although the U.S. is the primary market for the oil, pressure for development also comes from Chinese companies that have been investing hundreds of millions of dollars in leases.
Not for the 'faint of heart'
Cavernous pit mines account for the bulk of the 1.2 million barrels of oil generated daily in a region with an estimated 174 billion barrels in reserve.
Syncrude Canada Ltd., a joint venture that includes Exxon Mobil Corp.-controlled Imperial Oil Resources, has 8,000 workers; it spent $4.2 billion last year and has invested billions more in capital improvements.
"It is not a business for the faint of heart," spokesman Alain Moore said.
At Syncrude's Aurora Mine, dozens of electric shovels eat away at the tarry deposits. With each scoop, the behemoths drop 100 tons of dirt into trucks with beds as big as small houses.