Canadian crude oil production dropped in 2005

Tuesday, September 12, 2006

A CBC story by James Stevenson reports:

Canada's oil production dropped in 2005 for the first in six years as conventional supplies wane, but that should change as oilsands operations continue their rapid ramp-up.

According to a Statistics Canada report released Monday, companies pumped out 858 million barrels of crude last year, down 2.3 per cent from the year before. One of the key reasons for this drop was a major fire at Suncor Energy (TSX:SU), which cut production at Canada's second largest oilsands operation in half for three-quarters of the year.

"In general, this occurred mostly because of lower output from the conventional sector as well as unplanned interruptions in the non-conventional sector," the statistics agency said.

With Suncor's operations repaired and producing more than pre-fire levels, Canada's oilsands production hit a record 1.2 million daily barrels earlier this year, said Greg Stringham, vice-president of markets for the Canadian Association of Petroleum Producers.

A major expansion at the Syncrude joint venture, Canada's largest oilsands producer, has been slow coming on line due to odour emissions. But when up and running, the $8.4 billion expansion is expected to push Syncrude's production to about 350,000 barrels per day.

Any increase in overall Canadian oil production will have to come from greater oilsands output, Stringham said, as "conventional oil has been on a mild and extended decline since about 1997."