One of the pros and cons of oil sands stocks is that bitumen is a sludgy, molasses-like type of petroleum which requires upgrading at local facilities or sending it through the pipeline with the addition of diluent --- which is expensive.
I say it's a pro because there is value in bitumen for its own sake, the market for petroleum products extends well beyond light crude. Still, it's a con because it requires treatment.
A hybrid solution is partial upgrading and both Ivanhoe Energy (IVAN) and Meg Energy (MEGEF)are working on this technology, as is a private company ETX according to an article on the concept. This is interesting news, and another reason that I'm bullish on the prospects for Alberta's oil sands stocks.
Simultaneously there are also more companies looking into solvent extraction processes for their in-situ oil sands operations, which offers some advantages over SAGD or CSS (steam technologies), at least potentially.
When you consider that oil sands producers are on average coming in at a lower cost per barrel than their shale oil counterparts, it's hard to justify the significantly lower multiple they are on average garnering from Wall Street.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.