Investment, technological advances to double Canada's crude oil production by 2030
Canada will double its crude oil production by 2030, increasing output from three million barrels a day to 6.2 million barrels a day, according to a study by the Canadian Association of Petroleum Producers.
Oil sands is the main driver. In 2011 Western Canada, oil sands contributed 1.6 million barrels a day of crude oil. Conventional production in the West added another 1.1 million b/d whereas Eastern Canada just produced 300,000 b/d.
The oil coming out of Alberta is creating production bottlenecks in the south, most notably oversupply at the Cushing, Oklahoma pipeline and storage hub. Too much supply is driving down the price of oil.
"As a result, the price of crude oil in the Mid-continent has been depressed relative to global crude oil prices. For example, in the past year the price of West Texas Intermediate (WTI), a benchmark Midcontinent crude oil, has sold at a discount at times well over $20 per barrel compared to North Sea Brent, which is a light crude oil of similar quality that is sold on world markets," writes the report's authors.
The uptick in oil production, stronger than predicted a year ago, is coming from technological advances. There is also a lot of investment in the oil sands patch.
"In the last three years, there has been a significant number of direct investments made in the oil sands by Asian companies. Producers turn to overseas partners to provide capital to speed up development and to share in the risk and rewards of these projects"
The CAPP is an industry group made up of small and large oil and gas companies throughout Canada.
Graph and table from CAPP