BMI View: Our growth outlook for Canada's oil and gas industry remains modest given mounting headwinds in both the upstream and midstream sectors amid a low oil price environment . The greatest threats to these projects are unfavourable project economics and regulatory headwinds that will hamper the growth of oil sands-driven production and LNG terminal development, weighing on total hydrocarbon output. This is exacerbated by the likely drop in exploratory activity throughout Canadian acreage as companies revise capital expenditures in the coming year .
|e/f = BMI estimate/forecast. Source: EIA, BMI|
|Crude, NGPL & other liquids prod, 000b/d||4,000.9||4,312.0||4,585.5||4,800.1||5,025.1||5,141.9||5,209.2|
|Refined products production, 000b/d||1,894.0||1,912.9||1,893.8||1,893.8||1,893.8||1,884.3||1,874.9|
|Refined products consumption & ethanol, 000b/d||2,456.2||2,511.5||2,501.5||2,528.0||2,552.8||2,590.1||2,628.0|
|Dry natural gas production, bcm||145.2||151.1||146.6||142.2||139.4||136.6||135.2|
|Dry natural gas consumption, bcm||103.5||104.4||108.6||110.8||114.1||117.5||121.6|
The latest developments in Canada's oil and gas sector are:
We are reaffirmed in our negative outlook on long-term crude production growth in Canada following the election victory for the Liberal Party on October 19. A low oil price outlook and insufficient pipeline takeaway capacity will combine with the government's strong environmental mandate to undermine upstream and midstream developments.
Continued output growth in Canadian oil sands over the next two years will increase exported volumes of crude into the US. Lower oil prices have threatened the development of upstream projects beyond 2017, encouraging further cost saving measures throughout the oil-producing province of Alberta. However, we maintain that post-final investment decision (FID) projects that have already incurred substantial costs will continue to be brought online, increasing output by an average rate of 6.0% y-o-y between 2015 and 2017.
US President Barack Obama rejected the TransCanada's Keystone XK project on November 6, effectively ending efforts to build the project until a new administration takes over in 2017. This will sustain dependence on crude-by-rail transport given continued growth from forthcoming upstream developments and their inability to access seabound import markets.
On November 12, the Canada-Newfoundland and Labrador Offshore Petroleum Board (C-NLOPB) conducted the NL 15-01EN offshore bidding round in the Eastern Newfoundland region. This round ultimately assigned seven out of the eleven parcels on offer, raising just under USD905mn dollars. In spite of the investor-friendly nature, however, we do not expect these projects will advance until the end of the decade as producers continue to cut costs within a broader industry downturn .
On November 13, the newly inaugurated administration of Prime Minister Justin Trudeau met one of his campaign promises and ordered a ban on oil tanker traffic along the northern coast of British Columbia (BC). This act weakens the potential for Canada to expand its crude export portfolio to Asia as these vessels were to form an integral part in increasing takeaway capacity from Alberta's land-locked oil sands projects.
The Canada Oil & Gas Report has been researched at source and features BMI Research's independent forecasts for Canada including major indicators for oil, gas and LNG, covering all major indicators including reserves, production, consumption, refining capacity, prices, export volumes and values. The report includes full analysis of industry trends and prospects, national and multinational companies and changes in the regulatory environment.
BMI's Canada Oil & Gas Report provides professionals, consultancies, government departments, regulatory bodies and researchers with independent forecasts and competitive intelligence on the Canadian oil and gas industry.
- Benchmark BMI's independent oil and gas industry forecasts for Canada to test consensus views - a key input for successful budgeting and strategic business planning in the Canadian oil and gas market.
- Target business opportunities and risks in the Canadian oil and gas sector through reviews of latest industry trends, regulatory changes and major deals, projects and investments in Canada.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity) and Competitive Landscape Tables.
BMI Industry View
Summary of BMI’s key forecasts and industry analysis, covering oil and gas reserves, supply, demand and refining, plus analysis of landmark company developments and key changes in the regulatory environment.
Industry SWOT Analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the upstream and downstream sectors and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series and forecasts to end-2024 for all key industry indicators, supported by explicit assumptions, plus analysis of key downside risks to the main forecast:
- Pricing: Oil price (USD/bbl, WTI, Brent, OPEC basket, Urals); oil products prices (unleaded gasoline, gasoil/diesel, jet/kerosene – USD/bbl) at global hubs.
- Production, Consumption, Capacity & Reserves: Proven oil reserves (bn barrels), production, consumption, refinery capacity and throughputs (‘000b/d); proven gas reserves (tcm), production and consumption (bcm) and fuels trade.
- Imports & Exports: Crude oil exports/imports (‘000s b/d) and value of crude oil trade in USD. Fuels exports/imports (‘000s b/d) and value of fuels trade in USD. Natural gas imports/exports (bcm), by pipeline and/or LNG, and value of natural gas trade.
BMI’s Oil & Gas Risk Reward Index
BMI’s Risk Reward Indices provide investors (independents, NOCs, IOCs, oil services companies) looking for opportunities in the region with a clear country-comparative assessment of the upstream and downstream market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.
A profile of the upstream and downstream sectors, including analysis of reserves, output, consumption and trade of energy products; overview of the industry landscape and key players; assessment of the business operating environment and the latest regulatory developments.
Comparative company analyses by USD sales, % share of total sales, number of employees, year established, ownership structure, oil production (‘000b/d), gas production (bcm), downstream capacity (‘000b/d) and % market share.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate Company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
Regional perspective on size and value of the industry. Plus comparative rankings by production, refining, imports and exports of oil, gas and LNG.
Global Oil Market & Oil Products Outlook
Based on our country coverage of over 99% of global oil and gas production and consumption, BMI provides demand, supply and price forecasts to end-2024 for oil, gas and oil products.
The Oil & gas Reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.