CALGARY, Alberta, July 23 (UPI) -- Technological improvements in drilling into natural gas basins in Western Canada means initial production rates should increase through 2017, a regulator said.
The National Energy Board said average initial production rates in gas basins in the area declined from 2000 to 2006 as most operators focused on conventional deposits. Since 2007, operators have started focusing on reserves locked in shale basins, which are harder to exploit.
"Because these tight and shale formations tend to have higher initial production rates than the mature conventional resources of the Western Canada Sedimentary Basin, the overall average initial production rates started increasing," the NEB said in a report. "This upward trend to all initial production rates is expected to continue through 2017."
A forecast from the Canadian Association of Petroleum Producers finds the industry in general is in a downturn, with capital investments in the Western Canada Sedimentary Basin falling 33 percent from 2014 to around $35 billion.
Energy companies are spending less on exploration and production because of the sustained low price of crude oil. Overall, Canadian drillers are showing signs of durability, with rig services company Baker Hughes showing a weekly 8.4 percent increase in the number of rigs actively exploring for or producing oil and natural gas for the week ending July 17.
The NEB in its latest survey finds overall Canadian natural gas production in the decline. Regionally, gas production from Saskatchewan is holding steady, British Columbia data show a slight decrease and Alberta's gas production gains just over half percent between March and April, the last full month for which data are available.
