Canada's Oil Reserves + Commodity Currency

Canadian Oil has long been underestimated as people believe that the US imports the majority of its crude oil from Saudi Arabia and other middle eastern countries. However, quite the opposite is true; the United States, the "oil addict", brings the majority of its oil in from Canada every year, and the numbers keep growing. What most people don't know is that Canadian Oil Reserves could be the largest in the world, as there havn't been any significant discoveries in the middle east in quite some time, and the royal family will not allow an audit of its reserves (whose numbers havn't changed since almost 2006). So as you can tell the Arabic Oil on which the US "depends" is actually in question. Are there really as many barrels in the ground as they say? As a massive emerging economy, China's oil addiction is growing every year as well, and they will need an oil rich nation to depend on in the coming years. Canada's vast reserves of oil make its currency, the Canadian Dollar, what we call a commodity currency. This means that as the dependence on Canadian Oil increases and like wise the profits, the currency will follow suit, so you win on two levels. That is what makes Canada an A+ oil play, especially if the Saudi's are not being truthful about their reserves. This is an excellent investment for the coming years; as the rate of inflation within the US is set to rise the Canadian Dollar will be a good hedge against a devaluing currency. Companies like
Husky Energy(HSE:TSX) will see nice gains through their future and they will also provide you with quarterly dividends in Canadian Currency. The idea behind this investing technique is that when you purchase stocks on a foreign exchange like the Toronto Exchange (TSX) your US Dollars are converted into Canadian Dollars, and likewise down the road when you cash out, your money will be converted back. So you actually profit on 3 levels, first the stock itself will increase in price, second the currency will increase in price (or at least act as a hedge against a sliding US Dollar), and third the dividends are like a sign on bonus that you receive either quarterly or annually based on the company.

Use your head, Invest wisely and the profits will follow beind...

Canadian Oil Sands

Though the Alberta Oil Sands have rightfully inherited the title as the "worlds dirtiest oil", they do contain almost 97% of Canada's crude oil supply. Before the collapse in oil prices and the start of our current economic crisis the oil sands produced nearly 3/4 of a million barrels of synthetic crude oil each day, with a forecast of doubling the output by 2015. There is alot of work involved in tapping these unusual resources and until fairly recently the price of oil did not allow for such expensive projects. For each barrel of oil that is pulled from the sands the forest above must first be cut down, then approximately 2 tons of peat moss must be removed and finally about 2 more tons of sand must be removed from which to extract the oil; a very time consuming task. However, the majority of the oil contained within the Alberta Sands was until very recently unretrievable. It was so far below the surface and so frozen that it was impossible to extract. But with the new "in-situ" extraction methods such as SAGD (steam assisted gravity drainage) it becomes possible to retreive the oil in a cost effective manor.
The USA has been searching for a way to cut its dependency on OPEC oil for years now, and it seems like in the future the Alberta Oil Sands may be just the relief we've been waiting for.
My theory is that the economic crisis will continue to stunt the growth and development of the Oil Sands for the coming years. However, once things begin to level and the demand for oil starts to rise, the USA will continue its search for an OPEC competitor, and this is when activity in the Sands will resume its course with a vengence. There are also alot of environmental issues that are currently associated with the Alberta Sands but I believe the new "in-situ" extraction methods like the SAGD system will allow for a much cleaner and more affordable extraction of the crude oil contained there in the future. I believe that the sands will be an excellent investment home for the years to come, especially since so many of the worlds major reserves are on their way out.
To get the most bang for your buck here i think you should look for smaller companies that own rights to currently under-developed pieces of the Alberta Sands, as they will be serious candidates for future growth or buyouts.