Canada heads for second-best drilling year with 20,005 wells

Gary Park

Petroleum News Calgary correspondent

The bar has been raised yet again for Canada’s drilling sector, with the Petroleum Services Association of Canada hiking its 2004 forecast by 5 percent to 20,005 wells — the second best year on record next to last year’s 21,802.

Natural gas targets, led by shallow prospects in southeastern Alberta, southwestern Saskatchewan and northeastern British Columbia, will dominate activity even more.

The association predicted 18,965 wells in its original forecast in October. From 10,771 gas wells last year, the industry is anticipating 12,596 wells this year, or 63 percent of all wells drilled and 71 percent of the net producing wells.

Petroleum Services Association President Roger Soucy, speaking for 250 member companies, said there is no sign of activity abating in the popular gas regions.

“We fully expect natural gas to maintain the industry’s attention throughout 2004 and into 2005,” he said.

Soucy said the reduced forecast for 2004 stems from an anticipated 5 percent reduction in oil and gas capital spending.

The forecast is based on projected average commodity prices of C$5.25 per thousand cubic feet for gas and US$27.50 a barrel for oil.

Alberta will easily dominate the drilling, accounting for 14,790 wells, followed by Saskatchewan at 3,900 and British Columbia at 1,100, with the Northwest Territories, offshore East Coast and Manitoba making up the balance.