Drilling seasons decimated, group says

‘Pretty much non-existent’ in Canada

A forecast for oil and gas drilling in Canada downgraded its outlook for Alberta, where fewer than 2,000 wells are expected to be drilled this year, less than a third of 2014 levels.

“Drilling seasons, as we have come to know them, are pretty much non-existent,” Mark Salkeld, president and chief executive of the Petroleum Services Association of Canada, said Thursday.

“There may be some activity, but nowhere near the levels we had in 2013-14.”

In its updated drilling forecast for 2016, the association estimates about 1,900 wells will be drilled in

The number of petroleum services companies that have, or are in danger of, closing their doors forever is growing.

Alberta, down from 2,700 wells in an earlier forecast.

The prediction reflects a sharp decline from activity in 2014, when nearly 6,500 wells were drilled.

“The number of petroleum services companies that have, or are in danger of, closing their doors forever is growing,” Salkeld said, “and the thousands of workers who lost their jobs are looking at every industry, every opportunity to find work.”

The petroleum services group based its forecast on assumptions that West Texas Intermediate crude will hover around US$42 per barrel and that natural gas will trade around CDN$1.90 per thousand cubic feet.

The group’s national forecast for drilling activity remains unchanged, with 3,300 wells expected to be drilled this year.

Salkeld said a lack of progress on new pipelines is “hindering Canada’s economic growth, costing the country billions of dollars in lost revenue and negatively affecting our ability to attract capital investment.”