The Vancouver-Whistler Olympics are just over 3 years away… 2010… coming quick eh? 2014 is not much farther off.
I’ve blogged about it before. No doubt I will be blogging about it again.
I just want to remind everyone.
And don’t be fooled, The Canadian Government knows… at least the Geological Survey of Canada does. Right-hand/Left-hand? I dunno… but clearly there is no excuse.
Despite record drilling activity, natural gas extraction volumes have slipped from the peak set in 2002, and output per well is now declining at an annual rate of 28%. Put another way, energy companies must add 3,000 more wells in 2007 on top of the 15,000 now in production just to keep output from diminishing.
That would be a daunting challenge even if there were spare rigs and drilling crews standing by. As it now stands, there is no spare capacity of this sort anywhere in North America.
With only eight years of proven reserves left in Canada, Hughes suspects that natural gas output is about to fall off a cliff. Barring a miracle or two, Canada will soon experience challenges in providing for its own citizens, let alone producing surplus volumes bound for American furnaces.
So how, pray tell, will Canada expand Oil Sands production to 3 million bpd by 2020 (from 1 million today) if the Natural Gas they use to produce it will be basically gone by 2014?
LNG? Kitimat is only slated to regassify a peak of 1 billion cubic feet/day of Natural Gas… by 2015, Oil Sands production is on track to use 2-3 billion.
Either we need to build a bunch of Nukes (which take 10 years each.. so we better start, uh, 2 years ago)….
Or.. we build more LNG terminals… (no room in Vancouver… Prince Rupert is out of the competition… Port Alberni is too poor and shortsighted)
OOrr… we don’t have enough Natural Gas, and that’s just for the Oil Sands… that doesn’t include providing industrial, commercial and residential customers in Western Canada (Eastern Canada already imports its’ supplies, there is no “trans-Canada pipeline”)
Oh, and then there is the United States. 80% of their NG comes from Canada.
Of course, until the Gas actually runs dry.. the oil sands and US will get every drop. It’s the price that will change.
How do you feel about that new Natural Gas furnace, dryer and hotwater tank now?