Monday, June 7, 2010

Oil sands production on track to beat 2009’s 14% increase

Alberta oil sands production could see another big year as the economic recovery puts global crude demand back on track.

Overall production in the region ramped up 14% in 2009 despite the widespread economic downturn, unstable crude prices and global criticism aimed at Fort McMurray operations.

Alberta squeezed out 1.49 million barrels per day of raw crude bitumen from the oil sands for a year total of 544 million barrels, according to the province’s

Energy Resources Conservation Board.

Meanwhile conventional oil production in Alberta fell 8.6% in 2009 from 2008.

Higher yields from already established oil sands developments, like the ones run by Suncor for instance, more than compensated for the significant drop in spending on oil sands from some other key players, ERCB said.

Industry capital expenditures fell by roughly $8 billion last year, according to the Canadian Association of Petroleum Producers.

The International Energy Agency estimates global crude oil demand will increase by 2% this year.

The recovery in the world economy has resulted in world oil demand resuming its long-term growth trajectory, the IEA has said.

By 2019, overall Alberta production will reach 3.3 million barrels per day, 2.9 million barrels of which is marketable crude bitumen or synthetic and non-upgraded bitumen, according to the ERCB.

“The ability to increase bitumen production has offset the continuing decline in conventional crude oil,” it said.

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