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ATB: Alberta achieves record oil production in 1H2022
CANADA
ALBERTA’S oil production hit a new record of 3.6mn barrels per day (bpd) on average in the first half of 2022, according to a new report from ATB Economics. This represented a slight increase from 3.5mn bpd in the same period of 2021, and a rise from 2.3mn bpd a decade ago.
ATB noted that the oil sands accounted for 85% of total output over the first half of the year, and that oil sands production had increased by around 24,000 bpd, or 0.8%, year on year. However, conventional production – including condensate – saw a much larger y/y increase at 62,000 bpd or 12.5%.
ATB noted that while higher crude prices provided an incentive to increase production, there were other factors to consider, such as take- away capacity constraints in the region.
This was echoed by an S&P Global analyst for Canada, Kevin Birn, who was quoted by CBC News as saying conventional producers could incrementally respond quicker to rising prices while oil sands output increases could
be attributed to gradual capacity and efficiency improvements over the past decade. Birn expects production in the second half of the year to be even stronger.
Oil sands output could receive a boost when the Trans Mountain pipeline expansion project to Canada’s West Coast enters service, which is now projected for late 2023 after several delays. However, beyond that, there are concerns over how environmental policy will affect future oil sands development.
The Canadian government is currently hold- ing consultations on a planned emissions cap for the oil and gas industry and there is considera- ble uncertainty over how this will play out and what kind of cap could be implemented. Options include a cap-and-trade system or modified car- bon pricing for heavy industrial emitters.
The provincial government of Alberta has already signalled its opposition to any federal emissions requirement that could force the prov- ince to curtail its resource development.
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