Conventional Drilling is Up: Reserves Report Spells Out The Facts

The Energy Resources Conservation Board (ERCB) recently released Alberta’s reserves 2010 and supply/demand outlook 2011-2020, a source of information on the state of reserves and the supply and demand outlook for the province’s diverse energy resources.

The report revealed that, in 2010, Alberta’s conventional crude oil production averaged 459,000 barrels of oil per day with a yearly total of 168 million barrels, almost flat versus 2009 for the first time in years. Industry drilled twice as many conventional crude wells in 2010 compared to 2009, with high oil prices and advances in drilling and completion technology cited as the main reasons for the spike.

Although the number of natural gas connections fell by 19% in 2010 relative to 2009, economics and technology also played a role in encouraging an increase in connections in areas of the province containing liquids-rich gas, as gas pools rich in natural gas liquids are priced relative to crude oil.

Nevertheless, these developments must be put into perspective, says Carol Crowfoot, the ERCB’s Chief economist, as the trend clearly shows that the oil sands will continue to dominate Alberta’s energy production for years to come.

“The growth in oil sands production – and it’s really the in situ production – still dwarfs conventional crude oil and we don’t foresee that changing,” says Crowfoot.

Alberta produced 1.6 million barrels per day of raw crude bitumen from the oil sands in 2010, or a total of 589 million barrels. This represents an increase of 8% over 2009 oil sands production.

The ERCB also forecasts Alberta’s annual raw crude bitumen production will total 3.5 million barrels per day for a total of 1.3 billion barrels per year by 2020.

Alberta’s total remaining established crude bitumen and crude oil reserves totaled 170.8 billion barrels, consisting of 169.3 billion barrels of crude bitumen and 1.5 billion barrels of crude oil.

Remaining established marketable conventional gas reserves stood at 36.4 trillion cubic feet last year, while remaining established coal bed methane gas reserves were 2.4 trillion cubic feet. Alberta’s remaining established coal reserves are estimated at 37 billion tons.