Updated June 2024
Summary
A weaker global economy and rising global oil supply in 2023 led to a decline in world oil prices from the multiyear highs reached in 2022. Inflation continued to drive up capital and operating costs for oil production in Alberta, and the oil basins continued to mature which resulted in decline in productivity. In response to the lower prices, fewer new wells were placed on production in 2023, resulting in a modest 5% increase in crude oil production.
Crude oil production continued to rise in 2023, reaching an eight-year high. Light crude oil production accounted for 56% of total crude oil production. Producers continued to target formations containing high-value light crude oil with higher initial productivity rates and quicker payouts. In 2023, ultra-heavy crude oil production increased significantly, almost reaching 2014 levels. Producers are increasingly targeting formations containing ultra-heavy crude oil with favourable economics.
Figure S4.1 shows the average daily production of crude oil from all wells by the Petroleum Services Association of Alberta (PSAC) area.
Production in 2023
In 2023, production increased to 81.4 thousand cubic metres (103 m3/d) or 512.3 thousand barrels per day (103 bbl/d), a 5% increase from 77.3 103 m3/d (486.4 103 bbl/d) in 2022.
Despite fewer new wells in 2023, production growth persisted, partly driven by the production of the substantial number of new wells placed in 2022. Well performance also increased because most new wells were horizontal wells completed using hydraulic multistage fracturing and benefitted from improved technology and drilling advancements, which improved initial productivity and lowered production decline rates (see the well activity page).
Crude oil production in 2023 consisted of
- 56% light crude oil,
- 16% medium crude oil,
- 7% heavy crude oil, and
- 21% ultra-heavy crude oil.
Producers are increasingly commercializing formations with large volumes of light and ultra-heavy crude oil, such as the Cardium Formation, Montney Formation, and Mannville Group, because of the price premium on light oil and the relatively better economic returns on ultra-heavy oil.
Table S4.1 shows the crude oil production and wells placed on production in 2022 and 2023 and includes forecasts to 2033.
Forecast for 2024 to 2033
Based on the oil price forecast, total crude oil production is expected to increase from 81.4 103 m3/d (512.3 103 bbl/d) in 2023 to 91 103 m3/d (572.5 103 bbl/d) by 2026 as the number of new wells placed on production remains relatively elevated and producers are expected to take advantage of the Trans Mountain Pipeline Expansion. However, a decline in crude oil production to 83.5 103 m3/d (525.7 103 bbl/d) is anticipated by 2033, as the number of new wells placed on production will not offset the decline in production of existing wells.
The share of light crude oil production is expected to decrease from 56% in 2023 to 52% by 2033, whereas ultra-heavy crude oil production is expected to increase from 21% in 2023 to 25% by 2033.
Figure S4.2 shows the average daily production of crude oil by density.
Learn More
- Methodology
- Data [XLSX]
