The Conference Board of Canada (CBoC) predicts that oil production in the oilsands of Alberta may soon start a period of consistent growth.
The government of Alberta previously limited production in the province due to a lack of takeaway capacity, which in turn caused Canadian oil to be sold at a discount.
Now, thanks to using existing infrastructure more efficiently and adding additional pipelines, CBoC now believes that oil production will grow by 4.2% per annum on average between 2020 and 2024. An example of improving existing infrastructure can be seen in TC Energy and Enbridge’s pipeline-optimisation programme. Thanks to employing drag-reducing agents, the companies claim that by early January, the existing pipeline infrastructure will be able to transport an additional 150,000 barrels per day (bpd).
The director for forecasting and analysis at CBoC, Matthew Stewart, told CBC news that 2020 should represent a turning point for oil production in Alberta. He added:
“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.”
The curtailment policy has hindered development in the oilsands. For example, Suncor, the previous owner of the Petro-Canada lubricant brand, has complained that some of its plays have been disproportionately affected because it was not running at full capacity when the quotas were set in 2018.