Canadian, U.S. and Mexican oil and gas production is set to add a staggering 11 million barrels per day over the next 10 years, transforming the continent into an energy powerhouse.
In fact, the United States alone is on course to become the largest liquid producer in the world and looks almost certain to overtake Russia and Saudi Arabia before the decade is over, writes Ed Morse, Managing Director and the Head of Global Commodities Research at Citibank, in a note to clients.
The North American crude oil and natural gas liquids base appears to have the potential to nearly double from 15.4 million bpd in 2011 to almost 27 million bpd by 2020, says the U.S. bank, as oil sands and shale oil and production ramps up.
“The US was the largest oil producer in the world, gaining that rank when Russian production collapsed at the start of the Russian Revolution and holding onto it until the 1970s — U.S. output peaked at 11.3-m b/d in 1970,” Mr. Morse says. “Since then it has faltered, declining fitfully to a nadir of 6.8-m b/d in 2007, counting both oil and NGLs; but 2007 saw the turning point, with current trends pointing to US supply overtaking Saudi Arabia and Russia.
Last year, total production was up 2-m b/d above 2006 to 8.8-m b/d on average over 2011, with 9-m b/d by end-2011.”
Canada will also boost its share of hydrocarbons, thanks to oil sands especially as the industry has managed to bring the costs down to $50 to $60 per barrel.
Oil sands now look likely to grow by a sustained 210,000 bpd on average each year to 2020, and as far as 2030, with the major constraint being the growth in takeaway capacity, or logistics system, as in the Bakken and elsewhere, says Citibank.
Canada’s tight oil production is also expected to hit 500,000 barrels per day by 2020 as the Williston Basin/Bakken and British Colombia plays gather pace.
Correspondingly, NGL output in Canada is also expected to grow and could increase by 500,000 bpd by 2020. Much of this incremental NGL output is associated with shale gas production in British Columbia, but also East of the Rockies in Alberta and Saskatchewan
However, it may not be all smooth sailing. The country has not resolved issues with First Nations and the environmental backlash could delay developments.
“Either way, North America is becoming the new Middle East,” wrote Mr. Morse. “The only thing that can stop this is politics — environmentalists getting the upper hand over supply in the U.S., for instance; or First Nations impeding pipeline expansion in Canada; or Mexican production continuing to trip over the Mexican Constitution, impeding foreign investment or technology transfers — in North America itself.”
Source:
Why North America is the new Middle East: Citibank | Energy | News | Financial Post
Finally some good news for North America and us
finally getting energy independance from OPEC nations.
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