Forecasting: Can we try that again?

Gary Park

For Petroleum News

The Canadian oil industry’s erasers are working faster than those of Sudoku players these days.

In the latest overhaul of its forecasts, the Canadian Association of Petroleum Producers has slashed oil sands output targets as a result of projects delays, deferrals and cancellations and is now starting to extend target dates for new milestone numbers.

The industry’s chief lobby group now estimates 2008 production will average 1.22 million barrels per day, down 90,000 bpd from its June prediction.

For 2009, it is counting on a similar 90,000 bpd drop to 1.44 million bpd and expects the “moderate-growth path” to stretch over the next 11 years at least.

CAPP says that output will reach 1.86 million bpd in 2012 (off 160,000 bpd from its June target), 2.4 million bpd in 2015 (compared with the June estimate of 2.8 million bpd) and 2.83 million bpd in 2017 (a drop of 230,000 bpd).

By 2020 CAPP estimates volumes will hit 3.27 million bpd, falling a dramatic 1.28 million bpd short of what it forecast in June.

Those under way should be OK

But the next five-year stretch is likely to see the biggest change in forecast numbers, reflecting the impact of project deferrals over recent weeks, he said. As a result, output increases for 2012-17 will likely drop by 300,000 bpd.

From 2017 to 2020, estimates start to climb again based on CAPP’s assumption that deferred projects will be revived and by 2020 oil sands output should reach 3.3 million bpd, Stringham said.

CAPP said it will re-survey companies in February and should release its updated numbers in March or April.

Stringham said the shelving of planned upgraders will also result in more heavy oil in CAPP’s forecast and less upgraded light oil than it forecast in June.

Currently, about 67 percent of bitumen produced in Alberta is being upgraded in Alberta — a number that is unchanged in the latest forecast.