Crude Bitumen Production

• Production in 2000 totaled 39 million cubic metres (245 million barrels):
  
  • 22 million cubic metres (138 million barrels) came from mining and 17 million cubic metres (107 million barrels) from in situ projects.
    
• Total production represents 51,000 m³ /day (320,000 barrels/day) of synthetic crude oil (SCO) and 46,000 m³/day (288,000 barrels/day) of non-upgraded crude bitumen.

Approximately 40% of Alberta's total oil production in 2000 was from oil sands.

Crude Oil Reserves

Exploratory and development drilling, along with enhanced recovery methods continue to add to Alberta's conventional crude oil reserves.

• In 2000, 32.7 million cubic metres (206 million barrels) were added to the initial established reserves of conventional crude oil.
  
• The EUB estimates that, at year-end, Alberta's remaining established reserves of conventional crude oil were 286 million cubic metres (1.8 billion barrels) a 3.4 % reduction from 1999, but a smaller decline than occurred between 1998 and 1999.
  
• The EUB estimates the ultimate potential recoverable reserves of crude oil at 3.1 billion cubic metres (19.7 billion barrels).

Future improvements in technology should improve the current overall average conventional crude oil recovery efficiency of 27%.

The following figure shows annual production and remaining established reserves for crude bitumen and crude oil.

Crude Oil Production and Drilling

Despite declining production over the past two decades, Alberta still produces 119,000 m³/day (750,000 barrels/day) of conventional crude oil. Higher prices allowed for strong production performance in 2000 and created some momentum in crude oil drilling activity for the year.

• Production of conventional crude oil in 2000 totaled 44 million cubic metres (274 million barrels).
  
• The number of successful oil wells increased 65%, from 1,630 in 1999, to 2,700 in 2000.
  
• Increased activity helped slow the annual decline in production from 11% in 1999, to 2% in 2000.

With a forecast of continuing strong oil prices the EUB expects some 2,700 successful oil wells to be drilled in each of 2001 and 2002, levelling to about 2,500 wells per year over the remainder of the forecast to 2010.

Total Oil Supply and Demand

• Alberta's 2000 production from conventional oil, oil sands sources and pentanes plus was 242,000 m³/day (1.52 million barrels/day) about the same as 1999.
  
• Production is forecast to reach 413,000 m³/day (2.6 million barrels/day) by 2010 nearly a 71% increase.

A comparison of conventional oil production and bitumen production over the last 10 years clearly shows a trend towards a larger percentage from bitumen. This ability to shift from conventional oil to bitumen sources is unique to Alberta, allowing the province to offset the expected decline in conventional oil with bitumen production.

The EUB estimates production of bitumen will triple by 2010, accounting for as much as 70% of Alberta's oil supply.

NATURAL GAS

Natural Gas Reserves

Alberta has a large natural gas resource base. Current EUB estimates of the remaining ultimately recoverable conventional natural gas reserves stand at 2,747 billion cubic metres (98 trillion cubic feet). This reserve does not include Alberta's non-conventional natural gas potential (i.e. coal-bed methane and tight gas).

• In 2000, a slight increase to the remaining established reserves stemmed a reduction trend.
  
• At the end of 2000, Alberta's remaining established reserves of conventional natural gas stood at 1,211 billion cubic metres (43 trillion cubic feet).
  
• The EUB's ultimate marketable gas potential estimate of 5,600 billion cubic metres (200 trillion cubic feet) appears conservative and is being reviewed as a part of a new study targeted for completion in 2003.

Natural Gas Production and Drilling

Alberta continues to be the largest producer of natural gas in Canada, with current production representing approximately 83% of Canada's total natural gas production.

• In 2000, Alberta produced 141 billion cubic metres (5 trillion cubic feet) of marketable natural gas.
  
• There were 8,228 successful gas wells drilled in Alberta in 2000 a 37% increase over the 6,015 drilled in 1999.
  
• New drilling hasn't replaced gas production since 1982, however last year's record drilling replaced 90% of the production for 2000, compared to a replacement rate of 56% in 1999.

While Alberta's gas development has typically centred on shallow gas in southeastern Alberta, exploration is expected to expand in the western portion of the province. Improved cash flow will fuel investment in exploration and increase drilling. An estimate of some 10,000 successful wells per year is expected over the forecast period.

Natural Gas Supply and Demand

Although natural gas supply from conventional sources is expected to start moderately declining towards 2010, sufficient supply exists to meet Alberta's growing demand. As Alberta requirements increase and production declines over time, the volumes available for removal from the province will decline.

• Natural gas production is expected to decline by about 2% per year over the last five years of the forecast period.
  
• The EUB forecasts Alberta's natural gas requirements to be one-third of total Alberta production by the end of the forecast period.

The EUB's mandate ensures that Albertans have access to reliable energy supply within the province. This means natural gas requirements for Alberta's core market (residential, commercial and institutional consumers) are met into the future, before any new gas removal permits are approved by the EUB.

Non-conventional sources of natural gas, such as coal-bed methane, offer considerable potential for supplementing future supply of conventional gas.

ETHANE, OTHER NATURAL GAS LIQUIDS AND SULPHUR

• The supply of ethane is expected to meet demand over the forecast period.
  
• Remaining established reserves of ethane declined slightly to 252 million cubic metres (1.6 billion barrels) in 2000.
  
• The remaining established reserves of propane, butane and pentanes plus increased slightly to 222 million cubic metres (1.4 billion barrels) in 2000.
  
• The supply of propane and butane is expected to meet demand over the forecast period, however, a shortage of pentanes plus as a diluent for heavy oil and non-upgraded bitumen is expected by 2005. Other alternatives will be required to replace pentanes plus as a diluent.
  
• The remaining established reserve of sulphur is 98 million tonnes. Sulphur demand is not expected to increase and Alberta's sulphur inventory will continue to grow over the forecast period.

COAL

Recent sharp increases in coal prices, due to high oil and gas prices and record high global steel production, improved prospects for Alberta's low-sulphur coal and created opportunities for extending coal production.

• The current estimate for remaining established resources for all types of coal is about 34 billion tonnes.
  
• Alberta's coal reserves represent over a thousand years of supply at current production levels.
  
• Alberta's total coal production in 2000 was 34 million tonnes.
  
• Subbituminous coal production is expected to increase, beginning in the middle part of the forecast period, to meet demand for additional electricity generation.

This massive resource continues to contribute to the energy needs of Albertans, supplying about 80% of the province's electricity.

For further information please contact:

Eileen Kahler
EUB Communications
Telephone: (403) 297-8144
email: eileen.kahler@gov.ab.ca

Information Services
640 5 Avenue SW
Calgary, Alberta T2P 3G4
Telephone: (403) 297-8190
Fax: (403) 297-7040

EUB website: www.ercb.ca