Why this is important to Wisconsin businesses: Opportunities for Wisconsin companies
Canada is the world’s fifth-largest natural gas producer and sixth-largest producer of oil, according to the Canadian Association of Petroleum Producers. The oil sands, located in the province of Alberta, are the world’s third-largest crude reserve, and contain 165 billion barrels of recoverable oil. British Columbia is Canada’s second-largest natural gas producer (4.3 billion cubic feet of natural gas produced per day in 2015), behind Alberta (10.2 billion cubic feet of marketable natural gas produced per day in 2015). Although the bulk of Canada’s upstream oil and gas industry is located in western Canada (80 percent of oil production occurs in Alberta alone), oil and natural gas production and related activities occur in 12 of 13 provinces and territories.
This activity has had an appreciable impact on the Canadian economy. The oil and natural gas industry is the largest private sector investor in the country; capital project investment in 2014 totaled $81 billion, with a further $15 billion in land, royalty and tax payments made between 2013 and 2015. More than 440,000 people were directly or indirectly employed by this sector in 2014.
Much like its mining counterpart, Canada’s oil and gas sector has felt the repercussions of global economic trends. A rapid decline in oil prices, and subsequent project cancellations, led to significant job losses throughout 2015 and 2016. Alberta was dealt an additional blow when a large forest fire forced the evacuation of Fort McMurray and several nearby oil production camps and sites in early 2016.
There is now cause for optimism. Supply cuts have nudged oil prices upward, and projections suggest the sector will regain jobs between 2017 and 2020. Companies that have weathered the uncertainty are once again boosting spending, while focusing on leaner, more efficient business models and implementing clean technologies. In spite of the industry challenges, the 2016 Global Petroleum Show was a resounding success, proof that there is indeed life and opportunity in the Canadian oil and gas sector.