Thursday April 24, 2014

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Sask. sets records for oil production

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Saskatchewan’s oil patch set multiple new records in 2013, according to figures released by the provincial government on January 27, and in some categories, those benchmarks were only a year old.

The province’s oil production for the 2013 calendar year was 177.9 million barrels (equivalent to 487,400 barrels per day), which was up from the previous record of 172.9 million barrels (472,500 barrels per day) that was set in 2012.

“We knew that we were having a very strong year,” said McMillan. “We knew there were some challenges in the spring with a wet spring, so some of the drilling that was planned early on in the year couldn't take place.

“We didn't know how that would enter into the equation when we got the final numbers out, but we were very pleased that it was, again, another record year, building on last year's record numbers.”

A total of 3,371 oil wells were drilled in 2013, the third best year ever for drilling. This figure ranks behind only 2011 (3,528 oil wells) and 1997 (3,608 oil wells). Horizontal wells accounted for 2,433 of the wells drilled in 2013, which was significantly higher than the previous record of 2,036 wells, which was set in 2012.

Horizontal drilling accounted for about 72 per cent of the wells drilled in the province last year, and McMillan expects that the percentage will continue to climb.

“It's something that over the last few years, we have seen an increased number of (horizontal) wells, transitioning from the historic vertical wells to the more technically advanced and more expensive horizontal wells,” said McMillan. “The benefits that come with those investments are proving themselves out, and we really see industry continuing to shift their focus in that direction.”

A total of 978 wells were drilled in the southeast, which was about 29 per cent of the provincial total.

“In the last five or six years, Estevan and Weyburn's drilling area has grown substantially,” said McMillan. “Historically, that area would have had a smaller percentage, but because of the technological advances that have unlocked the Bakken and the other formations in the southeast, we see that being a very strong producer in the next few years.”

Not only is the Bakken home to significant interest, but McMillan said oil companies are eying other formations in the southeast that are accessible through new technologies.

McMillan noted that Saskatchewan is ranked as the number one jurisdiction in Canada for oil and gas investment policies, according to The Fraser Institute’s annual Global Petroleum Survey, and he expects that Saskatchewan will have another strong year for drilling in 2014.

 


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