As the turmoil in the Middle East continues, America intends to decrease its dependence on foreign oil by approximately 33% over the next 10 years. According to independently released long-term energy outlook reports provided by ExxonMobil (NYSE:XOM) and BP (NYSE:BP), oil will continue to be the primary energy source over the next 20 years, growing annually by 0.6%. With the goal of increasing domestic production, the moratorium on operations in the Gulf of Mexico has been lifted.

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U.S oil consumption currently represents approximately 20% of global output. Therefore, with oil prices of $185 per barrel estimated to hit by 2020, the requirement to increase domestic production is playing an essential role in American energy policy debates.

America's largest trading partner, Canada, however, is unlikely to see decreased energy demand since the foreign oil debate largely relates to the Middle East. Canada is the largest supplier of oil to the United States, exporting 1.97 million barrels per day. Saudi Arabia and Iran, on the other hand supply 1.08 and 0.41 million daily barrels, respectively.

Suncor (NYSE:SU) holds approximately 28 billion BOE in 3P resources, with 90% of 2011 operations focused on crude oil. This amount of estimated reserves only falls short to those of Exxon, Chevron (NYSE:CVX) and ConocoPhillips (NYSE:COP). Oil sands production is expected to increase at a compounded annual growth rate of 10% over the next nine years.

Suncor has also been showing strong financial performance improvements. Its year-over-year net debt position has decreased from $13.3 billion to $11.1 billion. In addition to the $6.656 billion of cash flow generated from operating activities, every dollar increase in the price of oil increases CFO by $114 million. Suncor is in a strong position to capitalize on higher oil prices.

Imperial Oil
Imperial Oil (TSE:IMO) is another top performing Canadian oil producer with over 15 billion barrel equivalents of proved and non-proved resource reserves. In 2010, Imperial produced 247,000 barrels of oil and NGLs per day and based on current production rates, the reserve life index stands at 28 years. According to management, "The company has the potential, with plans in place, to more than double Upstream production volumes by 2020. Volumes are targeted to be up about 40 percent by 2013."

Imperial Oil also has a strong balance sheet with total a cash flow from operating activities and asset sales to total debt ratio of 4.43. IMO is also the only Canadian industrial company to have maintained an AAA bond rating from Standard & Poor's. (So you've finally decided to start investing. But what should you put in your portfolio? Find out here. Check out How To Pick A Stock.)

The Bottom Line
Canada holds the second most proved reserves of crude oil, preceded only by Saudi Arabia. Growing international demand for Canadian energy products and the corresponding increase in oil field activity should produce significant gains for energy investors.

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