-12.4 C
Fort St. John
Friday, February 22, 2019
9924 101 ave Fort St. John, B.C.
Home Energy News New report pessimistic about future for Canadian natural gas exporters

New report pessimistic about future for Canadian natural gas exporters


OTTAWA, O.N. – The Conference Board of Canada says that tough times may be ahead for Canada’s natural gas producers, according to their latest publication: Canadian Industrial Outlook: Gas Extraction.

“North America’s regional natural gas market has changed greatly over the last decade. Rising U.S. shale production has increasingly squeezed Canadian natural gas out of some U.S. markets,” said Conference Board of Canada Economist Carlos A. Murillo. “And not only is the U.S. market moving toward self-sufficiency, but the U.S. gas industry is also beating Canadian competitors in the race to enter global liquefied natural gas markets.”

Following pre-tax losses of $7.6 billion in 2016, the Conference Board says that Canadian natural gas producers can expect losses to narrow down to $2.8 billion this year, mainly as result of rising commodity prices. Natural gas prices across North America reached their lowest levels in nearly two decades last year, but are expected to steadily climb over the next five years.

- Advertisement -

Meanwhile, U.S. natural gas production increased by 40 per cent in the last decade, mainly due to rapid increases in U.S. shale gas output. In the meantime, Canadian production stagnated to the point where today’s American shale production is about three times greater than total production in Canada. With U.S. shale gas production displacing imports of Canadian gas, Canadian exports are now 25 per cent lower than they were 10 years ago.

North American natural gas demand is expected to remain relatively flat over the forecast, and Canadian exports to the U.S. could continue to decline over the next five years. Although natural gas use in Canada’s electricity generation and industrial sectors will increase, these gains will not be enough to offset a potential decline in exports. “The need for Canadian gas in North America will continue to fall over the forecast. Unless a large domestic LNG export facility is built, Canadian production levels will continue to fall in the coming years”, explained Murillo.

get the latest news in your inbox



Local Events

Must Read

A look at 16 new recommendations for Ottawa on the Trans...

CALGARY, A.B. - The National Energy Board has endorsed an expansion of the Trans Mountain pipeline. If approved by Ottawa, the regulator says it...

8th Annual Crystal Cup starts tonight