March 18, 2021 – Seeking Alpha
Good News For Western Canada: Excess Pipeline Capacity By 2023
By: Josh Young
Western Canadian oil production was hit hard last year, reaching a low of 3.36 MMbbl/d in May of 2020. However, recent reports show the region has recovered to pre-pandemic production levels and most forecasts expect to see production reach all-time highs soon. A January 2021 RBN Energy report shows total crude oil production in Western Canada averaged 4.24 MMbbl/d for November 2020 and is estimated to average 4.3 MMbbl/d in December 2020.3 This is nearly at pre-pandemic levels from February 2020, and is a substantial recovery from last year’s low of 3.36 MMbbl/d in May 2020. It’s safe to say that the region’s production levels have rebounded from the effects of COVID19.
The industry consensus is that Western Canadian oil production will expand in 2021 and it will be a record year for Alberta’s oil sands production, due to the Alberta government’s removal of their 2-year long production limit (RBN, Reuters and S&P Platts).This will come primarily in the form of a 512 Mbbl/d increase in Alberta’s tar sands production in 2021 and the combined output from Canada’s other provinces, which is much smaller. RBN estimates that oil production in Canada will rise to a record-high 4.45 MMbbl/d this year, up from 3.9 MMbbl/d in 2020. This aligns with forecasts from major midstream operator Enbridge as well as S&P Platts, who both estimate a 500-600 Mbbl/d production increase in 2021.
Read the full article here: https://seekingalpha.com/article/4414798-good-news-for-western-canada-excess-pipeline-capacity-2023