The Canadian oil and gas industry could see investments topping pre-pandemic levels at some C$40 billion, or $29.36 billion, the Canadian Association of Petroleum Producers said.
The sum also represents an 11% increase over 2022 investment levels, equal to C$4 billion.
“The year 2023 may be one of the most pivotal moments in time for Canada’s oil and natural gas industry. With an emerging liquefied natural gas export industry, the expected completion of the Trans Mountain pipeline expansion, and billions of dollars in emissions reduction investments waiting to be unlocked, Canada is positioned to play a much larger role in providing responsibly produced energy resources to the world,” CAPP president and chief executive Lisa Baiton said.
Canada’s oil and gas industry has been plagued by problems such as excessive red tape and the tightening government grip around emissions from oil and gas production. Yet demand for both oil and gas globally has helped it tackle these and, as suggested by the expected investment, will cause the industry to grow.
Alberta, Canada’s top oil-producing province, recently announced plans to expand its reach into new markets by building what it calls economic corridors to the coasts of Canada and Alaska as a way of circumventing regulatory restrictions on new pipelines.
Meanwhile, the country’s largest natural gas producer, Tourmaline Oil Corp., is sending its natural gas to the U.S. Gulf Coast, where it gets liquefied and sent to international markets. That’s because there are still zero LNG facilities in Canada and the only one that authorities have approved is currently under construction. The government, meanwhile, has signaled it does not share CAPP’s belief that Canada has a future as an LNG exporter.
According to CAPP, the industry is also investing in emission reduction, not without a solid push from the federal government. Last year, Canadian oil and gas producers spent C$1.4 billion on research and development in that area and by 2025 the annual investment is seen rising to over C$2 billion.