CAPP forecast. Click to enlarge.

According to CAPP’s 2014 Crude Oil Forecast, Markets and Transportation, total Canadian crude oil production will increase to 6.4 million barrels per day by 2030 from 3.5 million barrels per day in 2013. For comparison, CAPP’s 2013 forecast estimated total production in 2030 at 6.7 million barrels per day, with oil sands production contributing 5.2 million barrels per day, and conventional production at 1.4 million barrels per day.

Over the full forecast period to 2030, the new forecast finds oil sands remain the primary growth driver with production growth to 4.8 million barrels per day, with an average annual growth of 170,000 b/d through to 2030. In 2013, 1.9 million b/d were produced from the oil sands of which 850,000 b/d was from mining and 1.1 million b/d from in situ projects.

Looking ahead to 2030, mining production is forecast to increase to 1.6 million b/d and in situ production is forecast to grow to 3.2 million b/d. Compared to CAPP’s 2013 forecast, this is 87,000 b/d lower for mining and 312,000 b/d lower for in situ.

Some projects were delayed beyond the current forecast period as a result of individual company decisions related to cost competitiveness and capital availability. These impacts are evident near the end of the forecast period.

Conventional oil production in Western Canada, including condensates, remains stable at 1.5 million barrels per day and Eastern Canadian offshore production declines to about 90,000 barrels per day.

Conventional oil production continues to reverse its previous long decline because of the continuing use of horizontal and multi-fracturing drilling techniques. Increased drilling in liquids-rich areas has also reversed a declining production trend for condensates, a light oil often used as diluent in the oil sands. In Eastern Canada, three recent discoveries in the Flemish Pass Basin may lead to increased projections for the region in future CAPP forecasts.

During the early part of the forecast period the 2013 and 2014 forecasts are very similar, with production from current projects and projects under construction being relatively firm. However, the latter part of the forecast is more dependent on new growth projects. While the overall trends in the two forecasts are consistent, the difference between the two forecasts later in the period primarily reflects increasing uncertainty regarding project timing related to cost competitiveness and capital availability. These impacts are more evident in proposed oil sands projects near the end of the forecast period.

As oil production increases, more transportation capacity is required to transport products to new and existing markets. The projected growth in production is dependent on expansion of transportation capacity to a portfolio of market opportunities.

While pipelines remain the primary transportation mode for large crude oil volumes over long periods of time, delay in the regulatory process for Keystone XL has provided the impetus for additional capacity from railways, barges, and tankers in the transportation mix, CAPP noted. With the construction of new loading and unloading facilities, existing rail lines provide flexibility to deliver to multiple destinations.

Pipeline and refinery map. Click to enlarge.

CAPP’s annual forecast is developed from oil producer survey data and CAPP analysis of historical trends, expected drilling activity, recent announcements and ongoing discussions with industry stakeholders and government agencies. CAPP does not forecast oil prices.

Pipelines and proposals. Click to enlarge.		Rail cycle time and cost. Click to enlarge.

The Canadian Association of Petroleum Producers (CAPP) represents companies, large and small, that explore for, develop and produce natural gas and crude oil throughout Canada. CAPP’s member companies produce about 90% of Canada’s natural gas and crude oil.