Canada’s oil sands are getting a style of their slower-growth future.
Husky Energy Inc. on Thursday turned the second large oil-sands producer to say that it throttled again first-quarter manufacturing in response to steeper reductions for Canadian crude. Those wider differentials stem from Alberta’s dearth of pipelines and railroads to haul crude to refiners. Rival oil-sands firm Cenovus Energy Inc. halted all investments in new tasks till the pipeline mess is resolved.
While Cenovus and Husky each billed their output slowdowns as momentary, the first-quarter hiccups foreshadow an period of shrinking positive factors in oil-sands manufacturing.
Output of bitumen and upgraded crude could develop 11% to 2.98 MMbpd this 12 months, in keeping with the Canadian Association of Petroleum Producers, boosted by megaprojects like Suncor Energy Inc.’s Fort Hills mine and an enlargement at Canadian Natural Resources Ltd.’s Horizon mine.
But these provide positive factors will taper off to 2.5% subsequent 12 months and common lower than 2% yearly by 2030 as pipeline and regulatory hurdles curtail investments on the planet’s third-largest oil reserves, CAPP stated.
“The slower progress is reflective of continuous uncertainty as firms assess the influence of impending dangers to their working surroundings,” the commerce group stated in a report final 12 months. “The financial competitiveness of the oil sands on a world scale is significant with the intention to appeal to capital to construct for the long run.”
Please depart feedback and suggestions beneath