Don’t count out Western Canadian gas

Talk of Western Canada’s early demise as a natural gas supply source are greatly exaggerated, a senior executive of the Canadian Association of Petroleum Producers told a Houston conference this month.

The growing emphasis on coalbed methane could contribute to a slight increase in volumes, or, at worst, flat-line production, Greg Stringham, the association’s vice president of markets and fiscal policy, said at the Ziff Energy gas strategies conference.

He also downplayed suggestions that oil sands production will drain new gas supplies to support extraction and processing of raw bitumen.

Some have suggested that the entire start-up in the Mackenzie Delta of 800 million to 1.2 billion cubic feet per day will never flow south of the oil sands region.

Stringham said a number of efficient alternatives are emerging to generate the heat, steam and power needed to exploit the oil sands.

However, Stringham and Jim Dilay, a member of the Alberta Energy and Utilities Board, conceded that a doubling of finding and development costs in the Western Canada Sedimentary Basin is a cause for concern.

Dilay was encouraged by a new joint Alberta Energy and Utilities Board and National Energy Board study that pointed to a 12 percent hike in the basin’s ultimate potential to 223 trillion cubic feet, which he said reflected a “vastly improved knowledge” of the region.

But he said that heavy investment in exploration is vital to meet growing demands.

—Gary Park