05 February 2009 19:09 [Source: ICIS news]
TORONTO (ICIS news)--The credit credit crunch and plummeting oil prices have hard hit the growth prospects of oil sands production in Canada’s Alberta province, with a recovery unlikely before 2013, Canadian Energy Research Institute (CERI) said on Thursday.
“What is clear to us is that, over the next few years, oil sands production growth will be almost at a standstill, and new capital investment will collapse to levels not seen since before the turn of the century,” the institute said in a research report.
In 2000, oil sands investment was just over Canadian dollar (C$) 4.0bn ($3.3bn).
While oil prices were expected to rebound to above $70/bbl by 2010, it would take at least another two years after that before oil sands production growth resumed, the institute said.
An oil price of $70/bbl or higher was required for the high-cost oil sands industry to start growing again, it said. Already operating projects should be able to cope with $50/bbl for the short term, it added.
CERI expected total oil sands production in a range of 1.9-2.9m bbl/day by 2015 and 3.7-5.4m bbl/day by 2030, depending on how quickly oil prices and capital market liquidity recover, it said.
This compares with its projection from 2008, when the industry was booming, of over 5m bbl/day by 2015 and over 6m bbl/day by 2030.
For the time being, the slowdown in oil sands production and the delay or cancellation of new projects has hurt not only
However, the slowdown also offered operators and new project project proponents the opportunity to seek out and secure materials and equipment at the lowest levels seen in almost 10 years, the institute said.
“It almost goes without saying that those who source their materials today - or at least in the very near future - will undoubtedly reap the rewards of their forward thinking and actions in the years to come,” it said.
($1 = C$1.22)
To discuss issues facing the chemical industry go to ICIS connect
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|
Asian Chemical Connections