29 Jun Canada’s daily oil sands production to grow 1 million barrels by 2025
Canada’s oil sands production is expected to grow by 1 million barrels per day over the next decade due to the expansion of existing facilities instead of new projects.
According to consulting firm IHS Energy, the estimated 42% production increase will help Canada remain among the world’s largest oil suppliers.
The country is part of the “G-5+2” – a group of low-cost Middle East oil-generating countries (The Gulf 5) in addition to the US and Canada. IHS analysts say they will account for most of the world’s oil supply growth over the next 10 years.
The majority of the growth will have to come from “brownfield” expansions where costs have decreased as a result of lower construction activity, cheaper natural gas and improved operating efficiencies.
Kevin Birn, IHS Energy director said: “We expect oil sands producers to focus future investments in the coming years onto their most economic projects – which we expect to be expansions of existing facilities.”
The cost of building and operating a new oil sands plant has dropped by US$10 a barrel since 2014 and IHS estimates that expanding an existing thermal oil sands operation could break at a US crude price of around $50 a barrel.