Wednesday, June 9, 2010

Canada oil output seen climbing 43 pct in 10 years

* Output could hit 3.29 mln bpd in 2015, 3.88 mln in '20

* Oil sands projects resuming after slowdown (Adds details, background)

CALGARY Alberta, June 9 (Reuters) - Canada's oil output may climb as much as 43 percent over the next decade, as oil sands projects deferred during the recession get back on track, the country's largest industry association said on Wednesday.

The Canadian Association of Petroleum Producers 2010 forecast sees output climbing to as high as 3.88 million barrels a day by 2020. The report marks a break from the previous three, when the association lowered its estimates because of an industry slowdown.

The first few years of CAPP's outlook period are similar to its last forecast, the group said.

"By the end of the period in 2025 the forecast shows a slightly higher supply outlook than previously forecasted due to the emergence of several new projects that were not part of last year's survey," it said.

In its most optimistic case, CAPP said overall oil output will rise to 3.29 million barrels a day by 2015 and 4.34 million by 2025.

Production in 2009 averaged 2.72 million bpd. Canada is the largest foreign supplier of crude to the United States.

In a low case that assumes that only current projects and those that are now under construction are operating, output will rise to 3.2 million bpd in 2015 and slip to 3.16 million by 2020.

Oil sands production, which averaged 1.3 million bpd in 2009, could hit 2.3 million bpd in 2015 and 2.9 million at the start of the next decade.

"Producers have returned many projects back to active development but remain mindful to establish a more controlled cost environment as they remain cautious with their estimates for future oil prices," CAPP said. (Reporting by Jeffrey Jones; Editing by Frank McGurty)

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