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Canadian oil output to rise 11.5% in ’06
Gary Park
New offshore Newfoundland production and ever-growing oil sands output will lift Canadian oil volumes by 11.5 percent by the end of 2006 to 2.9 million barrels per day, the National Energy Board predicts.
Although conventional light and medium oil production in Alberta will continue its decline by 353,000 barrels per day, the launch of Newfoundland’s third project will increase that region’s production by 100,000 bpd to 360,000 bpd.
Operational problems at the three integrated oil sands operations are forecast to drop production by 3 percent this year, with synthetic crude off 12 percent from 2004 at 571,000 bpd.
The anticipated rebound from those facilities will get an added lift from in-situ bitumen plants which are expected to tally 484,000 bpd in 2006 as eight expansion phases and new projects come on stream. EOR opportunities The board’s study notes that, while Western Canada’s conventional plays are relatively mature, with a projected recovery rate of only 22 percent of oil in place, there is still a large target for exploitation and governments are introducing several measures to promote enhanced oil recovery.
The federal regulator is predicting a decline of 2 percent in both 2005 and 2006 for conventional heavy crude — which has suffered from an industry focus on natural gas — to 199,000 bpd next year.
In Saskatchewan, which has averaged about 332,000 bpd from 2000 through 2003, stepped up drilling added 2 percent in 2004 and growth will continue into 2006 to 355,000 bpd.
The study says industry experts believe West Texas Intermediate crude will trade close to US$50 per barrel in 2006, with the market doubting prices will drop below the US$40-$45 range.
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