The Potential For Oil And. Gas Production From Canada''s Frontier Areas
Authors: Bruce G.C. , Motyka D.R. 
Published: March 2010

Introduction

The development of Canada's frontier hydrocarbon resources is vital to Canada's future growth and prosperity for several reasons. First, it will help offset the" decline in Canada's' conventional oil reserves. Second, it is necessary if Canada is to become oil self-sufficient. Third, the industrial benefits resulting from development of these northern resources will be extremely significant for many sectors of the troubled Canadian economy.

However, the challenges before us related to this development are as formidable as the physical environments in which the reserves are found. The solutions will require creative responses from the petroleum industry, from government and from the Canadian people.

This article will outline: the potential oil and gas reserves in Canada's frontier regions; frontier production and transportation options currently under study by Gulf Canada Resources; and some production scenarios and capital investment requirements. The article concludes by summarizing the need for development and identifying issues facing industry that are related to successfully meeting the challenges before us.

The Frontier Potential

Canada's frontier regions overlie sedimentary basins with an areal extent of approximately 4.5 million square kilometres, and are believed to contain a large hydrocarbon resource base. Two thirds of the Canadain frontiers lie offshore; it is these areas that are thought to contain the majority of resources.

The Beaufort Sea and Mackenzie Delta regions have been estimated by Gulf Canada to contain 0.95 billion cubic metres (6 billion barrels) of recoverable oil and 1.4 trillion cubic metres (50 trillion cubic feet) of gas. Since the early sixties in this area, more than 140 exploration wells have been drilled on land, and 30 wells offshore. Crude oil reserves discovered to date nave been estimated at 0.3 billion cubic metres (2 billion barrels) and natural gas at about 0.25 trillion cubic metres (9 trillion cubic feet).

In the region of the Northwest Territories excluding the Mackenzie Delta, we estimate there to be 0.3 billion cubic metres (2 billion barrels) of recoverable crude oil, of which 0.1 billion cubic metres (700 million barrels) have been discovered. Of an estimated 0.14 trillion cnbic metres (5 trillion cubic feet) of recoverable gas, 0.8 billion cubic metres (280 billion cubic feet) have been found to date.

Exploration has been ongoing in the Arctic Islands for over a decade. Many important finds have been made, and company estimates place discovered oil and gas reserves at 125 million cubic metres (800 million barrels) and 0.4 trillion cubic metres (15 trillion cubic feet) respectively. Arctic Islands sedimentary basins are expected to contain 0.63 billion cubic metres (4 billion barrels) of recoverable oil and 2.25 trillion cubic metres (80 trillion cubic feet) of gas.

The East Coast offshore region is estimated to contain 2.54 billion cubic metres (16 billion barrels) of recoverable oil

(Figure in full paper)

reserves, and a large reserve base of natural gas-2 trillion cubic metres (71 trillion cubic feet).