Canada’s oil production rose in February, up 4% YoY
Shale producers will continue pumping more and more hydrocarbons according to the latest analysis from the Department of Energy. The EIA released its Short Term Energy Outlook for the month of May yesterday, outlining expectations for energy markets in the immediate future.
U.S. crude oil production averaged 9.1 MMBOPD in April, 0.6 MMBOPD above the bottom of the downcycle in September 2016. The EIA forecasts that overall U.S. crude production in 2017 will average 9.3 MMBOPD, up from 8.9 MMBOPD in 2016. This growth will continue, as production in 2018 is predicted to grow by 7.5% to 10 MMBOPD. The EIA has revised its oil price forecast down slightly, and now expects WTI to average $51/bbl in 2017 and $55/bbl in 2018.
Natural gas production will grow as well, though not as quickly as oil production. The EIA predicts that the U.S. will produce 74.1 Bcf/d of gas, up 2.5% from the 72.3 Bcf/d produced in 2016. This growth will reverse the decline seen in 2016, as lower commodity prices constrained production. In 2018, the EIA predicts that U.S. natural gas production will grow a further 4% to 77.3 Bcf/d.
Alberta, Saskatchewan, British Columbia dominate Canadian energy
Statistics Canada released its oil and gas supply and disposition yesterday, outlining February production and consumption in Canada. In total, Canada produced 121.4 MMBO in February, up 4.1% from February 2016 production.
Source: Statistics Canada
Non-conventional oil production continues to dominate Canadian oil output, as conventional crude oil declines. In this case, “non-conventional” refers primarily to oil sands and bitumen production, not tight oil as the term generally means in the U.S. Bitumen and synthetic crude production rose by 8.9% in February, the sixth consecutive year-over-year increase. Conventional oil output, on the other hand, fell by 6.2% continuing the output decline that has been present since the beginning of the downturn in late 2014.
Alberta, Saskatchewan and British Columbia dominate Canada’s oil and gas production, comprising the vast majority of the nation’s output. Alberta is foremost among these, responsible for 81% of all oil production and 68.4% of Canada’s gas production. Saskatchewan produces most of the remaining Canadian crude oil and is responsible for 11.3% of output. British Columbia produces 28.4% of Canadian natural gas, leaving only 3.2% to be produced by other provinces.
Unlike oil, Canadian natural gas production fell year-over-year, down 4.1% to 441 Bcf in February. Canadian gas exports to and imports from the U.S. both rose in February, with exports growing 2.1% to 244 Bcf and imports soaring 75% to 102 Bcf.
Source: Statistics Canada
