IHS, a provider of critical information and insight, has released its outlook for Canadian oil sands production through 2025. IHS expects continued oil sands production growth through the period, with oil sands growth entering a new phase, driven primarily by the expansion of existing facilities with more attractive economics.
Oil sands production is forecast to grow by nearly one million barrels per day (bpd) by 2025—a significant pace of growth that, though lower than historical levels, will keep Canada among the largest sources of global oil supply growth. Canada is part of the “G-5+2”—a group of low-cost Middle East oil-producing countries (the Gulf-5) plus the United States and Canada. Collectively, they will account for most of the world’s oil supply growth.
Construction of projects that started before the fall in oil prices (and where significant capital has already been invested) will be complete by 2018, after which construction activity could cease. The subsequent completion and then ramp up of these facilities will drive growth to 2020. IHS expects growth to continue to advance, with the substantial majority—more than 75 percent—of future activity coming from the expansion of existing facilities. Over three quarters of future activity is expected to be underpinned by such expansions.