The world may not be able to afford more oil drilling, but that won’t stop the madness in Alberta continuing. The Canadian oil industry is poised for record year with 2008 profits rising 18 per cent to nearly $23 billion, according to the Conference Board of Canada.

The report forecasts 2009 profits will tumble 29 per cent, because of rising costs and because world oil production is being ramped up, before beginning a steady recovery and returning to the $23 billion level in 2012.

The independent research group said Canada’s oil extraction sector, a key economic pillar, posted a record $19.4 billion in profits last year on revenues of $123 billion.

And 2008 will be even better, the group’s report on the industry forecasts, as Canadian oil producers continue to benefit from high prices – forecast to average US$85 a barrel – and an expected 9.2 per cent rise in crude oil production.

The production increase comes exclusively from the oilsands since conventional crude production is set for a steady decline due to increasing costs and depletion of the resource.

“Non-conventional production will be the main driver behind all gains in domestic crude production for the foreseeable future,” the report states. “Overall, the health of the industry remains strong,” said the report.

Pity about the health of the planet, or the environment in Alberta….