Boston, MA -- (SBWIRE) -- 07/18/2013 -- Increasingly challenging economics could slow the growth of oil-sands driven production, although we note that liquid-rich shales could be the new engine of crude output. Exploration in the country's offshore acreage and unconventional resources could unearth more oil and gas reserves to support the country's long-term growth prospects. The outlook for Canada's oil and gas industry is still a rosy one, though its upstream potential needs more support from infrastructure development.

The main trends and developments we highlight for Canada's oil and gas sector are:

- We see a threat to growing oil reserves from oil sands projects. Due to the boom in light, sweet crude production in the US, demand for heavier Canadian crudes from oil sands has fallen. Complicated by infrastructure bottlenecks that are limiting crude flows, this has widened the discount between the prices of Canadian crudes and WTI, which has in turn hit the economics of oil sands projects.
- Canada's proven oil reserves are expected to fall from 173.1bn barrels (bbl) in 2013 to 158.0bn bbl in 2017 due to a slowdown in oil sands investment, but a reversal of this trend is expected, with proven reserves climbing back up to 162.0bn by 2022 thanks to additions from liquid shale developments.
- Proven gas reserves will increase from 1.9tcm in end-2012 to 2.1tcm in 2017 and pushed further to 2.3tcm by 2022 as discoveries, mainly from shale deposits, are booked as reserves. Exploration breakthroughs if favourable economics lead to an increase in offshore drilling activity pose upside risks to our forecasts.
- The industry rush into the Arctic may benefit Canada. The Globe and Mail reported that Imperial Oil is looking to submit drilling plans in the Arctic, possibly in 2013.
- We maintain our forecasts for oil production growth, which was downgraded last quarter based on expectations that a difficult market for heavy Canadian crude would slow the rate of production growth from oil sands deposits. However, we expect output to continue on an upward trend on the back of potential liquid shale production as unconventional drilling heats up. This could drive production to 4.37mn b/d in 2017 and 4.96mn b/d by 2022.
- The slack from Western investors in oil sand developments could be picked up by Asian companies eager to secure oil supply for the energy-hungry region. This is exemplified by Japan Petroleum Exploration Co (Japex)'s decision to commit CAD1.4bn (US$1.4bn) in the Hangingstone oil sands expansion project in December 2012, even as its western counterparts take a more cautious approach.

View Full Report Details and Table of Contents

About Fast Market Research
Fast Market Research is an online aggregator and distributor of market research and business information. Representing the world's top research publishers and analysts, we provide quick and easy access to the best competitive intelligence available. Our unbiased, expert staff will help you find the right research to fit your requirements and your budget. For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156.

Browse all Energy research reports at Fast Market Research

You may also be interested in these related reports:

- Cenovus Energy, Inc. Oil & Gas Exploration and Production Operations and Cost Analysis - Q3, 2012
- Swift Energy Company Oil & Gas Exploration and Production Operations and Cost Analysis - Q1, 2013
- Cabot Oil & Gas Corporation Oil & Gas Exploration and Production Operations and Cost Analysis - Q1, 2013
- Newfield Exploration Company Oil & Gas Exploration and Production Operations and Cost Analysis - Q1, 2013
- Apco Oil and Gas International Inc. Oil & Gas Exploration and Production Operations and Cost Analysis - Q1, 2013
- Oil & Gas Capital Expenditure Outlook 2013
- Linn Energy, LLC Oil & Gas Exploration and Production Operations and Cost Analysis - Q1, 2013
- EPL Oil & Gas, Inc. Oil & Gas Exploration and Production Operations and Cost Analysis - Q1, 2013
- Loews Corporation Oil & Gas Exploration and Production Operations and Cost Analysis - Q1, 2013
- Bill Barrett Corporation Oil & Gas Exploration and Production Operations and Cost Analysis - Q1, 2013