|
Canada needs frontier, non-conventional gas: Regulator says Arctic, offshore, coalbed methane key
Gary Park, PNA Canadian correspondent
For all of the bleak drilling results of 2002, Canada has potential natural gas resources of 603 trillion cubic feet and the prospect of increasing deliverability until at least 2025, the National Energy Board said Jan. 7.
In releasing a draft consultation paper on the long-term supply and demand outlook, the federal regulator said that growth is possible provided non-conventional (such as coalbed methane) and frontier (Arctic and offshore gas) supplies can be brought on stream to offset declining output from the Western Canada sedimentary basin.
Depending on the pace of technological advances and the level of environmental concern, the National Energy Board said Canada’s gas resources could range from 575 trillion to 603 trillion cubic feet, while deliverability, which reached 17 billion cubic feet per day in 2001, could peak at between 19 billion and 21 billion cubic feet per day in 2025. Current production meets about 15 percent of U.S. consumption.
In both case, the document said, frontier supply would include a Mackenzie Valley pipeline carrying 1 billion cubic feet per day by 2010, rising to 1.5 billion cubic feet per day by 2015.
Mackenzie could come on in 2008 Current proposals could actually see a standalone line from the Mackenzie Delta coming on stream by 2008 at 1.5 billion cubic feet per day and growing to 1.9 billion cubic feet per day.
As well, the board projections are based on two additional projects off Canada’s East Coast, each producing 500 million cubic feet per day and two similar projects offshore British Columbia by 2022.
Plans are already before regulators from EnCana to brings its Deep Panuke field offshore Nova Scotia into commercial production in 2005 at 400 million cubic feet per day.
In addition, exploration spending in the East Coast offshore is expected to tally C$1.5 billion this year, up C$500 million from 2002, despite a long series of failures in the past two years.
British Columbia offshore awaiting decisions The future of the British Columbia offshore is awaiting decisions from the provincial government on if and when it might seek to lift a 30-year moratorium on exploration of the region.
For Canada to achieve the board’s most optimistic production forecast by 2025, coalbed methane would need to reach 4 billion cubic feet per day from 3,000 wells at an average 150,000 cubic feet per day.
The report is the basis for public workshops in six Canadian cities during February. A final study will be released in May.
In its short-term deliverability report released before Christmas, the board forecast a decline to 15.9 billion cubic feet per day by the end of 2004 from 16.6 billion cubic feet per day in 2002.
It warned that despite a combination of lower initial production rates and faster decline rates over the past six years there was no evidence that the industry was deviating from its strategy by shifting to riskier areas of the Western Canada sedimentary basin in a bid to offset an expected 4.3 percent decline in deliverability over three years.
| 