The Oil & Gas Industry in Canada registered Total production of 7,327,776.52 boed in 2020
The indicator recorded a historical decline (CAGR) of 0.22% between 2017 to 2020, and is expected to grow by ...
GlobalData projects the indicator to grow ...
Why did the Total production of Oil & Gas Industry in Canada drop in 2020?
Majority of Canada’s oil and gas resources are produced from onshore oil sand deposits and shale or tight gas reservoirs of Alberta and British Columbia provinces. The country has marginal production from offshore developments. Oil sands projects have a particularly high operating expenditure due to required blending with lighter hydrocarbons, in order to make the crude flow through the pipelines. Oil sands projects account for more than a half of the total production in the country. In April, the main Canadian oil benchmark, West Canadian Select, fell and stayed low ever since. Launching new facilities at these prices is not profitable, as well as keeping some of the producing fields open. This forced producers to cut back capital expenditure and production in the months of April-May. However, in October the Alberta government announced that 2-year long production curtailments will be lifted as early as December this year, which is expected to have a positive impact on the production rebound.
In 2020, total production in Canada is expected to drop compared to last year, oil sands production is anticipated to drop in 2020. The drop is due to a number of projects in the country being delayed or even suspended due to weak oil and gas demand caused by the COVID-19 pandemic. This has impacted investments into planned projects and expansions of existing operations and caused temporary suspensions of some facilities. ConocoPhillips, Husky Energy, Cenovus Energy and several other operators voluntarily agreed to production cuts in the first half of 2020.
Overall total production in Canada is expected to stay flat during the outlook period, where contribution from oil sand facilities is anticipated to grow in 2025. Canada’s bitumen production is capex intensive and conflicting with Canadian government environmental goals, therefore suggesting a potential slower growth of production in the future.
Total Production (Boed) is crude oil and natural gas equivalent production/sales volume for the reporting period. For this computation, one barrel is the equivalent of six thousand cubic feet of gas.
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