Why this is important to Wisconsin businesses: Regulatory measures are putting pressure on the industry to reduce its environmental impact while continuing to ramp up production.
The Canadian oil and natural gas industry is developing and implementing innovative technologies to modernize, improve efficiency and reduce environmental impacts, with 185 projects underway. For 2018-19 the Canadian industry base-level maintenance spending continues, with a focus on leveraging new technologies, and a continued commitment to the Western Canadian Basin. Innovation is seen as a critical factor for sustainable growth for future. Dollars flow into drilling operations, production and environmental solutions throughout the oil and gas cycle, from extraction to production and transportation.
Oil and gas producers are balancing restrained capital investment with pressure of domestic uptake through 2020, alongside increasing pressures in an environmental regulatory climate. Canada stands at a crossroads, with global opportunities hinging on investment access routes to international markets. Spending is expected to stay on track, with a $33.2 billion commitment from operators.
Cost cutting: Innovation momentum and maintenance will continue through 2018, including:
- $10.2 billion maintenance slated for oil sands
- Technology and process improvements that reduce the economic and environmental cost of oil and gas operations
- Direct contact steam generation technology, which has the potential to reduce greenhouse gas emissions for in situ oil production by 70 to 80 percent and the production cost per barrel by 20 percent
- Autonomous and automated technology as it applies to oil sands operations for improved performance, economics and safety
- Prediction and cognitive tools
Expansion of drilling wells: Operators are putting resources into profitable wells. New technology applications being sought for completion and drilling techniques boost well production. The Canadian market is experiencing a 5 percent increase in the number of new wells for 2018.
- Extraction technologies using solvents have the potential to eliminate the use of water in resource extraction and to reduce greenhouse gas emissions on the order of 50 percent and capital cost requirements to develop the resource by about 30 percent.
- The newly minted Suncor Fort Hills and CNRL Horizon Phase 3 oil sands mining projects are ramping up their production in 2018.
Pipeline infrastructure: Enbridge, Kinder Morgan and TransCanada will continue to focus on eliminating bottlenecks and adding capacity to existing pipelines.
- Opportunities exist for technology that improves pipeline monitoring and operation by allowing operators to detect cracks, dents and other events/anomalies throughout the pipeline.
Hydraulic fracturing: $30 billion in capital investment will flow into the Duvernay Shale and nearby Monteney basin.
- Major energy firms such as Chevron, Shell and Encana are staking their claim due to abundance of oil and gas and lower operational costs enabled by new horizontal fracking technology.
- Water management technology and technology that addresses environmental impact/risks are in demand.
Liquid gas market: This market is on track for 4 to 5 percent growth in 2018. In connection with that growth, investment in liquefied natural gas outlets is seeing growth in domestic demand as well as exports to the U.S. market.
- Technologies that aim to enhance the environmental performance and effectiveness of the natural gas industry (e.g., renewable natural gas, power-to-gas and micro-combined heat and power technologies) are needed.
Environmental technology: Decarbonization regulations put pressure on oil and gas operators with greenhouse gas emission reduction targets. Innovation will be needed to meet those targets.
- There is a need for lower-emission products and innovations, including the use of renewable energy as a power source for the extraction sectors and hydrocarbon-based building products that could provide a lower-carbon-intensity substitute for cement.