Canada – Oil Production set to Rise over Two Years by 8%
Tie-backs to existing oil sands facilities or expansion of operational sites by some of the biggest Canadian oil firms are expected to boost Canada’s crude oil production by 8% by 2025, analysts have told Reuters.
Analysts at RBN Energy see Canadian crude oil production rising by 175,000 barrels per day (bpd) in 2023 and by another 200,000 bpd next year.
“Companies can finally say things have recovered enough in the industry that we can maintain returns to shareholders and put some money into production growth,” RBN Energy analyst Martin King told Reuters.
Last year, Canadian oil production hit a record 4.86 million bpd, per data from the Canada Energy Regulator. Analysts now expect output to grow in 2023, 2024, and 2025 as companies are ramping up production at new and tie-back sites in Alberta’s oil sands.
Despite the impact of wildfires in Alberta earlier this year, major oil and gas producers including Cenovus Energy and Canadian Natural Resources eye production growth for the rest of this year and in the near to medium term.
At Kirby, Canadian Natural Resources targets to grow production by around 15,000 bpd from Q4 2022 levels to approximately 65,000 bpd in Q4 2023, as the company progressed the development of four SAGD pads in 2023, Canadian Natural Resources’ president and CEO Tim McKay said on the Q2 earnings call earlier this month.
The three remaining pads are targeted to ramp up to full production capacity over the first nine months of 2024 at a pace of one-pad per quarter, McKay added.
Cenovus Energy’s president and CEO Jon McKenzie said on the earnings call, “We expect strong production from oil sands in the second half of 2023, and with all major maintenance behind us.”
Cenovus Energy is making good progress on the Narrows Lake to Christina Lake connection, from the Christina Lake operations to “another very rich area for development,” said Norrie Ramsay EVP, Upstream, Thermal, Major Projects & Offshore at Cenovus. Plans are for start of drilling at Narrows Lake pads in early 2025, Ramsay added.
