The number of wells expected to be drilled in Alberta this year has dropped significantly. The Petroleum Services Association of Canada now forecasts 2,948 wells will be drilled in this province, down 16.5 per cent from the 3,532 wells predicted in its original outlook for 2019.
Across Canada, the forecast has similarly dropped. It’s down 15 per cent, which PSAC President and CEO Gary Mar links to worsening confidence from investors.
“Lack of access to markets beyond the U.S. delayed again with the quashing of the approval of the Trans Mountain pipeline expansion project this year, uncertainty of any future projects being proposed should Bill C-69 be passed, and competitive issues, continue to weigh heavily on Canada’s ability to attract capital investment.”
Mar argues that the Alberta government’s decision to curtail oil production by 325,000 barrels per day has led producers to delay spending decisions. The updated forecast is based on average natural gas prices of $1.45 Canadian per million cubic feet, crude oil prices of $57 U.S. a barrel, and the Canada-U.S. exchange rate averaging $0.76.