It’s now expected that capital spending in Canada’s oil and gas sector is going to see its biggest two-year decline since Alberta’s first major oil discovery.
The Canadian Association of Petroleum Producers is forecasting that $31 billion will be invested in 2016, down 62 per cent from the record of $81 billion in 2014. That would be the biggest drop since CAPP’s predecessors started keeping track in 1947.
The number of wells drilled in western Canada is looking to decline to 3,500 this year, a 66 per cent drop from two years ago. At that time, the benchmark oil price was over $100 U.S. a barrel. Now, it’s about $37.
CAPP President and CEO Tim McMillan says urgent action is needed for Canada to stay an attractive and competitive market for oil and gas investment.