Economic Outlook for Canada’s Energy
Sector
Terry AbelDirector, Oil Sands
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Canadian Energy Supply Chain ForumOctober 2014
• Represents large and small producer member companies. • Members explore for, develop and produce natural gas,
natural gas liquids, crude oil, and oil sands throughout Canada.
• Produce about 90 per cent of Canada’s natural gas and crude oil.
• Part of a national industry with revenues of about $110 billion per year.
• Associate members provide a wide range of services that support the upstream crude oil and natural gas industry.
Canadian Association of Petroleum Producers
• Global energy demand will continue to grow.§ Population increases.§ Higher standard of living.
• Continued reliance on hydrocarbon resources despite growth in renewables.§ 82% in 2011; 78% is
forecast for 2035.
• Shift to unconventional sources of oil and gas.
Global Energy Demand Growth
Growth in Canadian Energy Production
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WTI NYMEX
Cdn Lt Swt
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WTI Premium to WCS
Factors Impacting Growth – Crude Oil Prices
Factors Impacting Growth – Transportation
Enbridge Mainline
Trans MountainExpress
PADD IV
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Auto Manufacturing
Forestry & Logging
Wheat& Barley Uranium
Annual Revenues ($ Billions)Major Canadian Products Industries
Source: ARC Financial & CAPP
• Payments to governments average about $18 billion per year.• 20% of the value of the Toronto Stock Exchange.• Approximately 20% of Canada’s exports.• Employs more than 550,000 in Canada (direct & indirect).• Invested $74 billion in Canada in 2013.§ Largest private sector investor in Canada.
Canada’s Energy Industry and the Economy
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Oil sands
Conventional
Shifting Energy Investment
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Oil Sands Share ofCapital Investment
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Note: Excludes spending on mergers & acquisitions
Western Canada2013 2014E 2015F$39 $36 $35
Western Canada2013 2014E 2015F$39 $36 $35
East Coast Offshore2013 2014E 2015F$3.9 $3.5 $3.5
East Coast Offshore2013 2014E 2015F$3.9 $3.5 $3.5
Total Energy Investment2013 2014E 2015F $74 $73 $69
Total Energy Investment2013 2014E 2015F $74 $73 $69Northern Canada
2013 2014E 2015F$0.1 $0.7 $0.5
Northern Canada2013 2014E 2015F$0.1 $0.7 $0.5
Oil Sands2013 2014E 2015F$31 $33 $30
Oil Sands2013 2014E 2015F$31 $33 $30
2015 Energy Investment Spending (Cdn $Billions)
Diversity of Supply Chain
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Suppliers to Canada’s Oil Sands (# of Companies by Region)
Aboriginal Business With Oil Sands Developers
•Athabasca Region Aboriginal Businesses:§ Revenues of $1.9B in 2013. § $10B in revenues over last 15 years.
•Employment:§ Over 1,700 aboriginal employees in permanent jobs.
Diversity of Supply Chain
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