Higher crude prices and continued optimisation improvements have driven the first upward revision to the S&P Global Commodity Insights 10-year oil sands production outlook in more than half a decade.
The new forecast, produced by the S&P Global Commodity Insights Oil Sands Dialogue, expects Canadian oil sands production to reach 3.7 million bpd by 2030, 0.5 million bpd higher than today. The new projection represents an increase of 140 000 bpd in 2030 from the previous outlook.
The main driver of the upward revision has been the identification of additional opportunities to improve efficiency and/or optimise output, the analysis says. The ongoing ramp-up and operational efficiency gains from learning by doing and step-out optimisation projects are the most significant contributors.
Step-out optimisations are a relatively new phenomenon and include, as the name suggests, stepping out from existing operational areas into new high-quality adjacent lands.
S&P Global Commodity Insights expects Canada to continue to post record crude oil production (both oil sands and non-oil sands crude) and export levels annually for the remainder of this decade. A deceleration in growth is expected to begin around the mid to late 2020s, but a very shallow decline only begins to emerge in the early 2030s. The reasons that the decline is expected to be particularly shallow is due to the long, flat production profile of Canadian oil sands assets.
Continued upside potential exists for the production outlook given the organic nature of how optimisation projects emerge, the analysis says. Policy remains the most likely source of downside risk. In particular, the advancing federal oil and gas cap which intends to establish an absolute oil sands emissions target, could temper investment if the targets prove too stringent and unattainable in the time provided, the analysis says.
Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/26052023/canadian-oil-sands-production-outlook-has-been-raised/
