Market Snapshot: Oil Sands Bitumen Production will continue to grow to 2040

Release date: 2018-01-31

The National Energy Board’s (NEB) recently released Canada's Energy Futures 2017 (EF2017) Supplement: Oil Sands Production report shows that growth in the oil sands will continue. Raw bitumen production in 2016 averaged just under 2.6 million barrels per day (MMb/d) and is projected to reach 4.5 MMb/d by 2040.

This graph shows projected production of raw bitumen by existing, expansion and entirely new or greenfield projects from 2010 to 2040.
Source and Description

Source: EF2017 Supplement: Oil Sands Production

Description: This graph shows projected production of raw bitumen by existing, expansion, and entirely new or greenfield projects from 2010 to 2040. The projection starts in 2017. Production from existing projects increases slightly over the projection period to 2.9 MMb/d by 2040. Expansions are projected to account for 28% or 1.2 MMb/d in 2040 while 0.4 MMb/d or 9% of total production is projected to come from greenfield projects.

Nearly all currently operating projects are expected to continue operation for decades, reaching 2.9 MMb/d by 2040. In technical terms this means that they have near zero decline rates. Having this large existing production base means any new projects or expansions will add to total production. The largest contributor to this growth will be expansions of existing facilities which are projected to add over 1.2 MMb/d. Lastly, construction of completely new or greenfield projects is projected to add 0.4 MMb/d.

Oil sands bitumen production is projected to continue increasing despite persistently low oil prices. In the near term, growth is due to projects coming online that were sanctioned or had begun construction prior to the price collapse in late 2014. Longer term, growth continues but at a slower pace. This is because the oil price required to incent expansions to currently operating projects, or to construct entirely new ones has fallen significantly in the last two years. Estimates now indicate that some expansion projects can be built with a WTIFootnote 1 price lower than US$ 50/bbl, while new projects can be built with WTI lower than US$ 60/bbl.

For more information on the NEB’s latest oil sands supply projections, please explore the recently released Oil Sands Supplemental Report. In addition to oil sands, two more production supplement reports are also available: crude oil and natural gas. Each report provides additional data and analysis related to the three cases released with EF2017 in October 2017 and also include production data and analysis from three additional cases including high and low oil and gas price cases to address price volatility.

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