Energy accounts for 16 percent of all Canadian exports

Gary Park

Petroleum News Calgary Correspondent

Energy exports, almost exclusively to the United States, accounted for 16 percent of Canada’s exports in 2003, generating C$62 billion in revenues, up 27 percent from 2002.

The National Energy Board reported that the net gain in energy trade (exports minus imports) for the year was C$36 billion, up C$6 billion from the previous year.

Natural gas easily outpaced oil, electricity and coal in the export categories, although export volumes dropped to 8.74 billion cubic feet per day from 9 billion in 2002.

Despite that 11.5 percent drop in exports, gas revenues surged by 41 percent to C$25.6 billion, reflecting the sharp rise in prices to C$6.75 per gigajoule from C$4.47.

For the first quarter of 2004, Statistics Canada reported that energy exports dropped by 13.7 percent to C$15.48 billion.

Oil exports were up by 88,000 barrels per day to 1.55 million bpd, with the value climbing to C$20.7 billion from C$18.9 billion. Canada imported 887,500 bpd to eastern refineries, representing 47 percent of total feedstock requirements.

The board noted that the energy sector provides 300,000 jobs, or 1.7 percent of the Canadian labor force, but accounts for 6 percent of the gross domestic product.

Oil and equivalent output increased 7 percent in 2003 to 2.48 million bpd, while natural gas liquids added another 577,000 bpd.

Conventional crude fell another 6.2 percent to 572,000 bpd, more than offset by the rise in synthetic crude and bitumen in Western Canada and a 24 percent jump from offshore Newfoundland to 358,500 bpd.

Gas production dropped to 16.8 billion cubic feet per day from 17.3 billion, with new reserve additions replacing about 89 percent of production from 1998 to 2002.

Board chairman Ken Vollman said the drop in conventional oil and flattening out of gas production has forced a shift to more diverse supply sources, such as the Arctic, East Coast and coalbed methane.

As a result Canadians “face increasingly complex and difficult choices in the energy sector as they confront conflicting goals, values and aspirations,” he said in the regulator’s annual report.