Conference Board of Canada Says that Prospects for Oil Production in Alberta have Improved

Canada’s energy sector is likely to enter a sustained period of growth owing to higher pipeline capacity and higher levels of efficiency in terms of using existing infrastructure. The report by the Conference Board of Canada predicts that a number of factors will help to bolster production in oilsands, at an average of approximately 4.2 per cent per year till 2024.

Enbridge and TC Energy have setup programs for optimizing the use of pipelines, which make use of agents that reduce drag, with the aim of boosting the flow on existent pipeline infrastructure, which will contribute 150,000 barrels for each day by the early part of next year.

Matthew Stewart, the director of forecasting and analysis for the board spoke about the recovery of the of the energy infrastructure in 2020, with major contributions coming from LNG Canada, Trans Mountain Pipeline, and the Coastal Gaslink Pipeline.

Report Emphasizes on Pipeline Expansion

Mr. Stewart said: “We think this is going to be a bit of turning point for Alberta in 2020. Now, investment is still much, much lower than it was in 2014. So, we have to keep that in context. But the improvement in takeaway capacity will encourage some improvement in investment. And we think that should drive GDP to the top of the charts in Alberta in 2020.”

While the Line 3 of Enbridge comes online, creating an additional capacity of 370,000 barrels per day, the expansion project by Trans Mountain will increase pipeline capacity by another 590,000 barrels per day by the end of 2023.

The report states:  “On top of expected improvements in takeaway capacity on existing pipelines, the Alberta government will grant exceptions to the curtailment for producers developing new conventional wells and those bringing new production online for rail export.”

It further says: “The outlook for production out of Alberta has brightened significantly, even as we head into the New Year with curtailments still in place. Canada’s energy sector will put its recent poor performance in the rear-view mirror over the medium term as the LNG Canada project and new oilsands investment lead to an average annual gain of 4.4 per cent in real oil and gas investment.”

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