Canadian Energy Weekly Round-Up: August 31, 2020
Here are the top news stories covering Canada’s energy landscape:
ESAI Energy: While Oil Production Increases Globally, Canadian Oil Sands Are Rebounding Faster than Others
As oil prices begin to stabilize, production amongst Canadian Oil Sands producers is rebounding faster than other energy markets, ESAI Energy reports.
In their latest North America Watch, ESAI Energy stated that oil sands production in Canada is expected to return to levels seen before COVID-19 by the end of the year—an almost complete recovery in less than 8 months. In contrast, ESAI mentioned the oil sands’ recovery will outpace the recovery of other markets, specifically the U.S. shale market.
Elizabeth Murphy, ESAI’s upstream analyst for North America, explains how the nature of oil sands production allows for a quicker, less intensive restart process than other types of energy:
“Canadian Oil Sands has virtually no base decline, so as production is returned online it can ramp up back to previous levels more quickly. The steep decline rates for shale require constant drilling and completion activity, and it will take a while to get production back to pre-pandemic levels.”
The ESAI report also touched on how producers in Canada and the U.S. are finding ways to cut operating costs, noting that small brownfield project expansions are going forward in the Oil Sands even as spending remains below normal.
Indigenous-owned Backwoods Energy Services begins oil well rehabilitation in Alberta
One of Canada’s largest indigenous-owned energy companies is restoring 56 oil well sites on the Enoch Cree Nation lands on outskirts of Edmonton, creating jobs for Indigenous Canadians.
The oil well reclamation and restoration work is being conducted as a part of the Alberta Department of Energy’s Site Rehabilitation Program (SRP). As a part of the SRP project, Backwoods will be able to employ Indigenous workers and carry out abandonment activities on suspended and abandoned oil and gas sites in Alberta.
Chief Tony Alexis of Alexis Nakota Sioux Nation, which owns a majority stake in Backwoods, says the collaboration is a prime example of industry collaborating with the indigenous community to restore their lands:
“The SRP provides important initial funding to cleanup well sites throughout the Province of Alberta, including within Alexis Traditional Territory. Backwoods’ partnership with Enoch Cree Nation for the SRP is a leading example of Indigenous communities collaboratively working together to preserve the land for generations.”
The SRP project is just a part of the Alberta government’s plan to spur the province’s economic recovery from COVID-19. Alberta’s $1 billion SRP includes appointing an Indigenous liaison to help facilitate First Nations’ participation in the program.
Alberta Premier Jason Kenny emphasized the role that the Indigenous communities of Alberta and surrounding provinces play in the economic recovery plan:
“First Nations must be a part of Alberta’s economic recovery from the COVID recession. The billion-dollar Site Rehabilitation Program is an important part of the Alberta Recovery Plan. It will create thousands of jobs, and help to save energy service companies during this crisis in the oil and gas industry. We’re doing everything we can to ensure that Indigenous Albertans participate in this program, as workers, contractors and by cleaning up abandoned wells on First Nations Reserves.”
Backwoods has been in business for more than 30 years and takes on short-term, weekly projects in addition to large, multi-year projects. Backwoods was acquired by the Alexis Nakota Sioux Nation in 2015.
For more Canadian energy news and setting the record straight on the day’s top stories about the oil and natural gas industry, visit Canadian Energy Network.