Canada is a country rich in natural resources, and the Canadian economy has long been driven by resource industries. Forestry, mining, and even fisheries probably come to mind when you talk about important industries in Canada.
The powerhouse of Canada’s economy today, however, is the energy sector. This industry is also driven by natural resources, most particularly Canada’s booming oil & gas industry. Most Canadians are aware of the Athabasca oil sands and increasing production in Alberta, but the oil & gas industry operates in almost every province. Exploration and extraction activities are important in Newfoundland and Labrador, BC, and the Far North as well.
Here are four facts about oil & gas exploration and extraction in Canada you may not know.
1. Canada Has the World’s Third-Largest Proven Reserves
Canada ranks only behind Venezuela’s Orinoco Belt and Saudi Arabia’s reserves. In fact, Canada’s reserves account for approximately 10 percent of the world’s known crude oil reserves. About 97 percent of this is located in the Athabasca oil sands in northern Alberta. Other sources include shale and tight light oil resources.
The western coast of Newfoundland and Labrador has reserves of oil, and exploration is taking place in the Far North to locate additional oil reserves there. BC may have shale oil reserves, as does most of the Rocky Mountains range. Crude oil is produced in almost every province across the country.
2. Production Is Nearly 4 Million Barrels Per Day
While Canadians had long known about the oil sands, it wasn’t until more recently that it became possible to develop this extensive resource. Development was slowed by the discovery of conventional oil resources in Leduc, Alberta, in 1947. Alberta’s oil industry began growing then, but efforts to develop the oil sands continue. Commercial production began in the 1960s, and since the 1990s, production has expanded rapidly.
Other resources, including reserves in Newfoundland, have also been developing rapidly in the early part of the 21st century. In 2016, Canadian oil production was 3.9 million barrels per day. Most production came from the oil sands in Alberta.
3. Liquid Natural Gas Is a New Resource
While Canada’s energy exports are driven largely by oil production in Alberta, natural gas is another important resource. Recently, the provincial government in British Columbia has been developing its liquefied natural gas (LNG) resources. In 2016, the first LNG export facility was sanctioned.
BC expects to continue investing in a rapidly developing and expanding market for LNG.
4. The Arctic: An Untapped Resource
Much of the Far North has been trapped under snow, ice, and a layer of permafrost for centuries. As the permafrost recedes, the oil & gas industry has become interested in exploring the region. Just how much oil and gas are located in the Arctic?
Many of Russia’s largest oil reserves are located in the far north of the country and in the Arctic Ocean, leading to speculation that large, unproven reserves exist within the Arctic Circle. Norwegian oil & gas exploration is already drilling in the Barents Sea off the country’s north coast.
The Canadian North, including Yukon, Northwest Territories, and Nunavut, are likely to be rich in mineral resources as well. Estimates suggest there could be 90 billion barrels of oil under the Arctic Ocean. Here in Canada, the Mackenzie-Beaufort Sea delta and watershed, which covers much of Northwest Territories, contains billions of barrels of oil.
Given these facts, it’s not surprising most people in the oil & gas industry feel it’s a matter of “when” the Arctic will be developed, not a question of “if.”
A Growing Industry
It’s clear the oil & gas industry in Canada is growing. Exploration and extraction are the primary drivers, but jobs are also available in refinement and other areas of the industry. It’s likely Canada’s oil & gas industry will be an economic force for years to come.