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Oil tops Western Canada drilling
Gary Park For Petroleum News
Western Canada’s petroleum industry is riding an oil wave, with Alberta tallying 2,556 development wells in the first seven months, the highest point in 30 years of record-keeping.
The four western provinces of Alberta, Saskatchewan, Manitoba and British Columbia racked up 3,727 development completions in the January-July period, 62 percent of completions for oil, gas, service and dry wells, up 1,293 from the comparable oil count in the same timeframe last year.
Exploratory completions have also posted solid gains at 554, compared with 407 a year ago, but exploratory drilling has accounted for only 17 percent of all drilling so far this year, marking a continued decline.
The swing to oil, despite some volatility in crude prices, looks certain to continue over at least the next year, with regulators in Western Canada issuing 6,678 permits (which are valid for 12 months) for new oil wells, up 49 percent from the same seven-month period last year, while the total well permits rose 20 percent to 10,388, the highest total since 2008.
A record 5,204 or 50 percent of the permits issued to the end of July were for horizontal wells, compared with 16 percent in 2008.
Completions up by a third Industry and government regulators reported that 8,120 wells were completed across Canada in the seven months, up 33 percent from last year’s 6,102 completions.
The breakdown includes 4,295 oil wells, 2,755 gas wells, 827 service wells and 253 dry holes.
Saskatchewan was second to Alberta, with 1,492 oil completions, up 401 from last year, while Manitoba dipped to 194 oil completions from 204.
An estimated 500 wells were completed across Canada in July, including 300 oil wells and 97 gas wells.
A total of 43.6 million feet of wells were drilled to the end of July, including 2.9 million feet in July, which is typically the low point for the year.
Operators securing the most horizontal permits were Canadian Natural Resources 357, Penn West Petroleum 265, Crescent Point Energy 240, Husky Energy 188 and Encana 182.
The most popular zones were Viking at 745 licenses, Montney 556, Cardium 545, Bakken 359 and McMurray 198.
The license count includes 1,083 oil sands evaluations, up from 783 a year ago and the most since 2008 when the total was 1,737.
Regulators issued 893 permits for oil or bitumen targets in July, up from 757 in July 2010 and the highest in a decade.
Of the seven-month total, 3,562 oil permits were authorized in Alberta, up from 2,280 last year; 2,756 in Saskatchewan, up from 1,766; and 324 for Manitoba, down from 325.
Gas and coalbed methane permits remained at a decade low 311 in July, down 47 from last year, and lagging far behind the peak 1,645 in 2004.
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