Petroleum production in Canada
Encyclopedia
Petroleum production in Canada is a major industry
Economy of Canada
Canada has the tenth largest economy in the world , is one of the world's wealthiest nations, and is a member of the Organization for Economic Co-operation and Development and Group of Eight . As with other developed nations, the Canadian economy is dominated by the service industry, which employs...

 which is important to the economy of North America
Economy of North America
The economy of North America comprises more than 528 million people in its 23 sovereign states and 15 dependent territories...

. Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...

 is the sixth largest oil producing country in the world. In 2008 it produced an average of 438000 m3/d of crude oil, crude bitumen and natural gas condensate
Natural gas condensate
Natural-gas condensate is a low-density mixture of hydrocarbon liquids that are present as gaseous components in the raw natural gas produced from many natural gas fields....

. Of that amount, 45% was conventional crude oil, 49.5% was bitumen from oil sands, and 5.5% was condensate from natural gas wells. Most of Canadian petroleum production, approximately 283000 m3/d, was exported, almost all of it to the United States. Canada is the largest single source of oil imports into the United States.

The petroleum industry in Canada is also referred to as the Canadian "Oil Patch"; the term refers especially to upstream
Upstream (oil industry)
The oil and gas industry is usually divided into three major components: Upstream, midstream and downstream, though midstream operations are usually included in the downstream category....

 operations (exploration and production of oil and gas), and to a lesser degree to downstream
Downstream (oil industry)
The petroleum industry is usually divided into three major components: Upstream, midstream and downstream. Midstream operations are usually included in the downstream category....

 operations (refining, distribution, and selling of oil and gas products). In 2005, almost 25,000 new oil well
Oil well
An oil well is a general term for any boring through the earth's surface that is designed to find and acquire petroleum oil hydrocarbons. Usually some natural gas is produced along with the oil. A well that is designed to produce mainly or only gas may be termed a gas well.-History:The earliest...

s were spud (drilled) in Canada. Daily, over 100 new wells are spud in the province of Alberta
Alberta
Alberta is a province of Canada. It had an estimated population of 3.7 million in 2010 making it the most populous of Canada's three prairie provinces...

 alone .

History

The Canadian petroleum industry developed in parallel with that one of the United States. The first oil well in Canada was dug by hand (rather than drilled) in 1858 by James Miller Williams
James Miller Williams
James Miller Williams was a businessman and political figure in Ontario, Canada. He represented Hamilton in the Legislative Assembly of Ontario from 1867 to 1879. He is also commonly viewed as the father of the petroleum industry in Canada.He was born in 1818 in Camden, New Jersey, and apprenticed...

 near his asphalt plant at Oil Springs, Ontario
Oil Springs, Ontario
Oil Springs is a village in Lambton County, Ontario, Canada, located along Former Provincial Highway 21 south of Oil City. The village, an enclave within Enniskillen Township, is home to the Oil Museum of Canada....

. At a depth of 20 metres (65.6 ft) he struck oil, one year before "Colonel" Edwin Drake
Edwin Drake
Edwin Laurentine Drake , also known as Colonel Drake, was an American oil driller, popularly credited with being the first to drill for oil in the United States.-Early life:...

 drilled the first oil well in the United States. Williams later went on to found "The Canadian Oil Company" which qualified as the world’s first integrated oil company
Vertical integration
In microeconomics and management, the term vertical integration describes a style of management control. Vertically integrated companies in a supply chain are united through a common owner. Usually each member of the supply chain produces a different product or service, and the products combine to...

.

Petroleum production in Ontario expanded rapidly, and practically every significant producer became his own refiner
Oil refinery
An oil refinery or petroleum refinery is an industrial process plant where crude oil is processed and refined into more useful petroleum products, such as gasoline, diesel fuel, asphalt base, heating oil, kerosene, and liquefied petroleum gas...

. By 1864, 20 refineries were operating in Oil Springs and seven in Petrolia, Ontario
Petrolia, Ontario
Petrolia is a town in Ontario, Canada, near Sarnia. The town, an enclave within Enniskillen Township, is billed as "Canada's Victorian Oil Town" and is often credited with starting the Oil industry in North America....

. However, Ontario's status as an important oil producer did not last long. By 1880 Canada was a net importer of oil from the United States.

Canada's unique geography
Geography
Geography is the science that studies the lands, features, inhabitants, and phenomena of Earth. A literal translation would be "to describe or write about the Earth". The first person to use the word "geography" was Eratosthenes...

, geology
Geology
Geology is the science comprising the study of solid Earth, the rocks of which it is composed, and the processes by which it evolves. Geology gives insight into the history of the Earth, as it provides the primary evidence for plate tectonics, the evolutionary history of life, and past climates...

, resources and patterns of settlement have been key factors in the history of Canada
History of Canada
The history of Canada covers the period from the arrival of Paleo-Indians thousands of years ago to the present day. Canada has been inhabited for millennia by distinctive groups of Aboriginal peoples, among whom evolved trade networks, spiritual beliefs, and social hierarchies...

. The development of the petroleum
Petroleum
Petroleum or crude oil is a naturally occurring, flammable liquid consisting of a complex mixture of hydrocarbons of various molecular weights and other liquid organic compounds, that are found in geologic formations beneath the Earth's surface. Petroleum is recovered mostly through oil drilling...

 sector helps illustrate how they have helped make the nation quite distinct from the United States.

Major players

The country's three largest integrated refiners are Imperial Oil, Husky Energy, Suncor Energy. While Petro Canada is considered by some as its own entity and fourth key refiner, it's actually owned by Suncor Energy. In 2007 Canada's three biggest oil companies brought in record profits of $11.75 billion, up 10 percent from $10.72 billion in 2006. Revenues for the Big Three climbed to $80 billion from about $72 billion in 2006. The numbers exclude Shell Canada and ConocoPhillips Canada, two private subsidiaries that produced almost 500,000 barrels per day in 2006.
  • EnCana Corporation
    EnCana Corporation
    Encana Corporation is one of North America's largest natural gas producers, with about 95 percent of its production being natural gas. Its strategy is to be the lowest-cost, highest-growth senior natural gas producer in North America. The company produced approximately of natural gas in 2010.The...

  • Canadian Natural Resources Limited
  • Husky Energy Inc.
    Husky Energy
    Husky Energy Inc. is a large integrated Canadian energy company based in Calgary, Alberta. Husky's foundation is in Western Canada, where it has extensive conventional oil and natural gas assets, significant heavy oil production and a range of midstream and downstream operations, including...

  • ConocoPhillips
    ConocoPhillips
    ConocoPhillips Company is an American multinational energy corporation with its headquarters located in the Energy Corridor district of Houston, Texas in the United States...

  • Talisman Energy Inc.
    Talisman Energy
    Talisman Energy Inc. is one of Canada's largest petroleum SB companies. Based in Calgary, Alberta, Talisman Energy has operations around the globe including: Canada and the United States of America in North America; Colombia and Peru in South America; Algeria in North Africa; United Kingdom,...

  • Devon Canada Corporation
  • Suncor Energy
  • Cenovus Energy
    Cenovus Energy
    Cenovus Energy is an integrated oil company headquartered in Calgary, Alberta.Cenovus was formed on December 1, 2009 when Encana Corporation split into two distinct companies: one an integrated oil company , the other a pure play natural gas company . The split left Cenovus with the assets formerly...


Divisions

Most exploration
Exploration
Exploration is the act of searching or traveling around a terrain for the purpose of discovery of resources or information. Exploration occurs in all non-sessile animal species, including humans...

 and production occurs in Alberta
Alberta
Alberta is a province of Canada. It had an estimated population of 3.7 million in 2010 making it the most populous of Canada's three prairie provinces...

, with a significant number of operations in British Columbia
British Columbia
British Columbia is the westernmost of Canada's provinces and is known for its natural beauty, as reflected in its Latin motto, Splendor sine occasu . Its name was chosen by Queen Victoria in 1858...

—particularly in winter—and consistent activity in Saskatchewan
Saskatchewan
Saskatchewan is a prairie province in Canada, which has an area of . Saskatchewan is bordered on the west by Alberta, on the north by the Northwest Territories, on the east by Manitoba, and on the south by the U.S. states of Montana and North Dakota....

. Drilling from large offshore platforms occurs on the Newfoundland continental shelf.

Alberta

Alberta is the largest producer of conventional crude oil, synthetic crude
Synthetic crude
Synthetic crude is the output from a bitumen/extra heavy oil upgrader facility used in connection with oil sand production. It may also refer to shale oil, an output from an oil shale pyrolysis. The properties of the synthetic crude depend on the processes used in the upgrading. Typically, it is...

, natural gas
Natural gas
Natural gas is a naturally occurring gas mixture consisting primarily of methane, typically with 0–20% higher hydrocarbons . It is found associated with other hydrocarbon fuel, in coal beds, as methane clathrates, and is an important fuel source and a major feedstock for fertilizers.Most natural...

 and gas products in Canada. Two of the largest producers of petrochemicals in North America
North America
North America is a continent wholly within the Northern Hemisphere and almost wholly within the Western Hemisphere. It is also considered a northern subcontinent of the Americas...

 are located in central and north central Alberta. In both Red Deer
Red Deer, Alberta
Red Deer is a city in Central Alberta, Canada. It is located near the midpoint of the Calgary-Edmonton Corridor and is surrounded by Red Deer County. It is Alberta's third-most-populous city – after Calgary and Edmonton. The city is located in aspen parkland, a region of rolling hills...

 and Edmonton, world class polyethylene
Polyethylene
Polyethylene or polythene is the most widely used plastic, with an annual production of approximately 80 million metric tons...

 and vinyl
Vinyl
A vinyl compound is any organic compound that contains a vinyl group ,which are derivatives of ethene, CH2=CH2, with one hydrogen atom replaced with some other group...

 manufacturers produce products shipped all over the world, and Edmonton's oil refineries provide the raw materials for a large petrochemical
Petrochemical
Petrochemicals are chemical products derived from petroleum. Some chemical compounds made from petroleum are also obtained from other fossil fuels, such as coal or natural gas, or renewable sources such as corn or sugar cane....

 industry to the east of Edmonton. There are hundreds of small companies in Alberta dedicated to providing various services to this industry—from drilling to well maintenance, pipeline
Pipeline transport
Pipeline transport is the transportation of goods through a pipe. Most commonly, liquids and gases are sent, but pneumatic tubes that transport solid capsules using compressed air are also used....

 maintenance to seismic
Reflection seismology
Reflection seismology is a method of exploration geophysics that uses the principles of seismology to estimate the properties of the Earth's subsurface from reflected seismic waves. The method requires a controlled seismic source of energy, such as dynamite/Tovex, a specialized air gun or a...

 exploration.

The Athabasca Oil Sands
Athabasca Oil Sands
The Athabasca oil sands are large deposits of bitumen, or extremely heavy crude oil, located in northeastern Alberta, Canada - roughly centred on the boomtown of Fort McMurray...

 have estimated oil reserves in excess of that of the rest of the world, estimated to be 1.6 trillion barrels (254 km3). With the advancement of extraction methods, bitumen and economical synthetic crude are produced at costs nearing that of conventional crude. This technology grew and developed in Alberta. Many companies employ both conventional strip mining and non-conventional methods to extract the bitumen from the Athabasca deposit. With current technology, only 315 billion barrels (50 km3) are recoverable. Entire towns, like Fort McMurray
Fort McMurray, Alberta
Fort McMurray is an urban service area in the Regional Municipality of Wood Buffalo in Alberta, Canada. It was previously incorporated as a city on September 1, 1980. It became an urban service area when it amalgamated with Improvement District No. 143 on April 1, 1995 to create the Municipality...

, have grown up entirely because of the large multinational corporations which have taken on the task of oil production.

While Edmonton is considered the pipeline junction, manufacturing, chemical processing, research and refining centre of the province, Calgary is known for its senior and junior oil company head offices.

Major oil field
Oil field
An oil field is a region with an abundance of oil wells extracting petroleum from below ground. Because the oil reservoirs typically extend over a large area, possibly several hundred kilometres across, full exploitation entails multiple wells scattered across the area...

s are found in southeast Alberta
Alberta
Alberta is a province of Canada. It had an estimated population of 3.7 million in 2010 making it the most populous of Canada's three prairie provinces...

 (Brooks, Medicine Hat, Lethbridge), northwest (Grande Prairie, High Level, Rainbow Lake, Zama), central (Caroline, Red Deer), and northeast (Athabasca Oil Sands
Athabasca Oil Sands
The Athabasca oil sands are large deposits of bitumen, or extremely heavy crude oil, located in northeastern Alberta, Canada - roughly centred on the boomtown of Fort McMurray...

)

Structural regions include: Foothills, Greater Arch, Deep Basin.
  • Oil and gas activity is regulated by the Alberta Energy Resources Conservation Board (ERCB)(Formerly the Energy and Utility Board (EUB)).

British Columbia

Drilling for gas and oil in the Peace Country of north-eastern British Columbia
British Columbia
British Columbia is the westernmost of Canada's provinces and is known for its natural beauty, as reflected in its Latin motto, Splendor sine occasu . Its name was chosen by Queen Victoria in 1858...

, around Fort Nelson
Fort Nelson, British Columbia
Fort Nelson is a town of approximately 5000 residents in British Columbia's northeastern corner. It is the administrative centre of the newly formed Northern Rockies Regional Municipality, a first for BC. The majority of Fort Nelson's economic activities have historically been concentrated in the...

 (Greater Sierra oil field
Greater Sierra (oil field)
Greater Sierra is a large oil and gas field in northeastern British Columbia, Canada.It is located east and north from the town of Fort Nelson, extending to the Alberta and Northwest Territories borders .Drilling activity takes place largely during the winter months, when the otherwise soft muskeg...

), Fort St. John
Fort St. John, British Columbia
The City of Fort St. John is a city in northeastern British Columbia, Canada. A member municipality of the Peace River Regional District, the city covers an area of about 22 km² with 22,000 residents . Located at Mile 47, it is one of the largest cities along the Alaska Highway. Originally...

 (Pink Mountain, Ring Border) and Dawson Creek
Dawson Creek, British Columbia
Dawson Creek is a small city in northeastern British Columbia, Canada. The municipality of had a population of 11,529 in 2009. Dawson Creek derives its name from the creek of the same name that runs through the community. The creek was named after George Mercer Dawson by a member of his land...

  • Oil and gas activity is regulated by the Oil and Gas Commission (OGC).

Saskatchewan

  • Mostly shallow gas wells in southwestern Saskatchewan
    Saskatchewan
    Saskatchewan is a prairie province in Canada, which has an area of . Saskatchewan is bordered on the west by Alberta, on the north by the Northwest Territories, on the east by Manitoba, and on the south by the U.S. states of Montana and North Dakota....

     (Hatton, Cypress Hill) and the southeast (Lougheed, Weir Hill), heavy oil extraction around Lloydminster
    Lloydminster
    Lloydminster is a Canadian city which has the unusual geographic distinction of straddling the provincial border between Alberta and Saskatchewan...

    , oil wells around Weyburn
    Weyburn, Saskatchewan
    Weyburn is a city in southeastern Saskatchewan, Canada. It is located on the Souris River southeast of the provincial capital of Regina and is north of the border with the United States. The name is reputedly a corruption of the Scottish "wee burn," referring to a small creek. The city is...

    .
  • Oil and gas activity is regulated by the Saskatchewan Industry and Resources (SIR) .

Northern Canada (onshore)

  • Drilling for oil in the Mackenzie Delta
    Mackenzie River
    The Mackenzie River is the largest river system in Canada. It flows through a vast, isolated region of forest and tundra entirely within the country's Northwest Territories, although its many tributaries reach into four other Canadian provinces and territories...

     by Petro-Canada
    Petro-Canada
    Petro-Canada was a crown corporation of Canada in the field of oil and natural gas. It was headquartered in the Petro-Canada Centre in Calgary, Alberta. In August, 2009, Petro-Canada merged with Suncor Energy, a deal in which Suncor investors received approximately 60 per cent ownership of the...


Northern Canada (offshore)

  • Production in the Beaufort Sea
    Beaufort Sea
    The Beaufort Sea is a marginal sea of the Arctic Ocean, located north of the Northwest Territories, the Yukon, and Alaska, west of Canada's Arctic islands. The sea is named after hydrographer Sir Francis Beaufort...

     off the Mackenzie Delta.
  • Sporadic drilling along the continental shelf of the Beaufort Sea.

Eastern Canada (onshore)

  • Sporadic drilling in southern Ontario
    Ontario
    Ontario is a province of Canada, located in east-central Canada. It is Canada's most populous province and second largest in total area. It is home to the nation's most populous city, Toronto, and the nation's capital, Ottawa....

     by Talisman Energy Inc.
    Talisman Energy
    Talisman Energy Inc. is one of Canada's largest petroleum SB companies. Based in Calgary, Alberta, Talisman Energy has operations around the globe including: Canada and the United States of America in North America; Colombia and Peru in South America; Algeria in North Africa; United Kingdom,...

  • Sporadic drilling in western Newfoundland
  • Sporadic drilling in northern Nova Scotia
    Nova Scotia
    Nova Scotia is one of Canada's three Maritime provinces and is the most populous province in Atlantic Canada. The name of the province is Latin for "New Scotland," but "Nova Scotia" is the recognized, English-language name of the province. The provincial capital is Halifax. Nova Scotia is the...

     and western Cape Breton Island
    Cape Breton Island
    Cape Breton Island is an island on the Atlantic coast of North America. It likely corresponds to the word Breton, the French demonym for Brittany....

  • Sporadic drilling in northern and eastern Prince Edward Island
    Prince Edward Island
    Prince Edward Island is a Canadian province consisting of an island of the same name, as well as other islands. The maritime province is the smallest in the nation in both land area and population...

  • Production of natural gas at the McCully Field in southern New Brunswick
    New Brunswick
    New Brunswick is one of Canada's three Maritime provinces and is the only province in the federation that is constitutionally bilingual . The provincial capital is Fredericton and Saint John is the most populous city. Greater Moncton is the largest Census Metropolitan Area...

    , connected to the Maritimes and Northeast Pipeline

Eastern Canada (offshore)

  • Offshore
    Oil platform
    An oil platform, also referred to as an offshore platform or, somewhat incorrectly, oil rig, is a lаrge structure with facilities to drill wells, to extract and process oil and natural gas, and to temporarily store product until it can be brought to shore for refining and marketing...

     oil drilling and production at Hibernia
    Hibernia (oil field)
    Hibernia is an oil field in the North Atlantic Ocean, approximately east-southeast of St. John's, Newfoundland, Canada.The production platform Hibernia is the world's largest oil platform and consists of a 37,000-tonne integrated topsides facility mounted on a 600,000-tonne gravity base structure...

    , Terra Nova
    Terra Nova (oil field)
    Terra Nova is an oil field development project 350 kilometres off the coast of Newfoundland. Discovered in 1984 by Petro-Canada, the field is the second largest off Canada's East Coast. Terra Nova is the first harsh environment development in North America to use a Floating Production Storage and...

    , and White Rose
    White Rose (oil field)
    White Rose is an oil field development project 350 kilometres off the coast of Newfoundland. Husky Energy is the operator and 72.5 per cent interest holder in the White Rose oil fields....

     fields off the coast of Newfoundland
  • Offshore
    Oil platform
    An oil platform, also referred to as an offshore platform or, somewhat incorrectly, oil rig, is a lаrge structure with facilities to drill wells, to extract and process oil and natural gas, and to temporarily store product until it can be brought to shore for refining and marketing...

     gas drilling and production on Sable Island
    Sable Offshore Energy Project
    The Sable Offshore Energy Project is a consortium based in Halifax, Nova Scotia which is attempting to locate and produce natural gas found near Sable Island on the edge of the Nova Scotian continental shelf in eastern Canada...

     fields off the coast of Nova Scotia
    Nova Scotia
    Nova Scotia is one of Canada's three Maritime provinces and is the most populous province in Atlantic Canada. The name of the province is Latin for "New Scotland," but "Nova Scotia" is the recognized, English-language name of the province. The provincial capital is Halifax. Nova Scotia is the...

  • Sporadic drilling along continental shelf off Nova Scotia.
  • Sporadic drilling in Laurentian Fan at southern end of Cabot Strait
    Cabot Strait
    Cabot Strait is a strait in eastern Canada approximately 110 kilometres wide between Cape Ray, Newfoundland and Cape North, Cape Breton Island. It is the widest of the three outlets for the Gulf of Saint Lawrence into the Atlantic Ocean, the others being the Strait of Belle Isle and Strait of Canso...

  • Sporadic drilling in eastern Northumberland Strait
    Northumberland Strait
    The Northumberland Strait is a strait in the southern part of the Gulf of Saint Lawrence in eastern Canada...


Long-term outlook

Broadly speaking Canadian oil production (via standard deep drilling) peaked in the mid-1970s, but due to the new offshore basins being exploited in Atlantic Canada and the boom of the Alberta Oil Sands overall production will not peak until the late 2020s.

Oil fields of Canada

These oil fields are economically important to the Canadian economy, either in the present or historically
  • Athabasca Oil Sands, Alberta
    Athabasca Oil Sands
    The Athabasca oil sands are large deposits of bitumen, or extremely heavy crude oil, located in northeastern Alberta, Canada - roughly centred on the boomtown of Fort McMurray...

  • Hibernia Oil Platform
    Hibernia (oil field)
    Hibernia is an oil field in the North Atlantic Ocean, approximately east-southeast of St. John's, Newfoundland, Canada.The production platform Hibernia is the world's largest oil platform and consists of a 37,000-tonne integrated topsides facility mounted on a 600,000-tonne gravity base structure...

  • Terra Nova oil field
  • White Rose oil field
  • Hamburg oil field, Alberta
    Hamburg (oil field)
    The Hamburg oil field is a remote area in north-western Alberta, Canada, with intense exploration and production of oil and gas.The closest town is Manning, at 180 km east....


See also

  • Peak Oil
    Peak oil
    Peak oil is the point in time when the maximum rate of global petroleum extraction is reached, after which the rate of production enters terminal decline. This concept is based on the observed production rates of individual oil wells, projected reserves and the combined production rate of a field...

     an economic condition of oil production that Canada reached in the late 1970s
  • Peak Gas
    Peak gas
    Peak gas is the point in time at which the maximum global natural gas production rate is reached, after which the rate of production enters its terminal decline. Natural gas is a fossil fuel formed from plant matter over the course of millions of years. It is a finite resource and thus considered...

    , related to Peak Oil
  • The North American Free Trade Agreement
    North American Free Trade Agreement
    The North American Free Trade Agreement or NAFTA is an agreement signed by the governments of Canada, Mexico, and the United States, creating a trilateral trade bloc in North America. The agreement came into force on January 1, 1994. It superseded the Canada – United States Free Trade Agreement...

    (NAFTA) has a clause in it relating to oil and gas export celinge that may force Canada to abandon the treaty to keep its own economy functioning

External links

The source of this article is wikipedia, the free encyclopedia.  The text of this article is licensed under the GFDL.
 
x
OK