Brian Zinchuk is editor and owner of Pipeline Online
Alliance Drilling Rig 2 north of Glen Ewen on Sept. 29. Photo by Brian Zinchuk
The Canadian Association of Energy Contractors (CAOEC) held its 2023 State of the Industry event on Nov. 24 in Calgary.
The CAOEC’s 2023/24 Drilling and Service Rig Forecast and the 2023 State of the Industry Report is as follows:
- Projected 2024 wells drilled: 6,229 – an increase of 481 from 2023 (5,748)
- Projected 2024 drilling operating days: 65,399 – an increase of 5,046 from 2023 (60,353)
- Projected 2024 service operating hours: 1,075,220 – an increase of 77,696 from 2023 (997,524)
- Total jobs expected: 39,435 – an increase of 3,045 from 2023 (36,390)
Three pipelines offer promise
The Association said it is pleased to report that 2024 will bring modest growth to the industry. “Most of this growth is expected to happen in the second half of the year as the market comes off a softer Q3 in 2023. A continuation of capital discipline within energy producers will create a ceiling on potential growth, although this may be countered by the increase in new pipeline capacity with projects such as the Key Access Pipeline System (KAPS), Trans Mountain and Coastal GasLink pipelines, as well as the recent expansion of the Nova Gas Transmission Ltd. (NGTL) System.”
The 575 km KAPS pipeline will collect condensate and other petroleum liquids produced with natural gas in the Montney and Duvernay regions and bring it to the liquids processing and storage hub at Fort Saskatchewan. The pipeline consists of a 16-inch pipeline for condensate and a 12-inch pipeline for NGL mix and handles 350,000 barrels per day.
Trans Mountain lowering in crew. Photo by Trans Mountain
Trans Mountain Expansion is nearing completion, with most of the spreads wrapping up mechanical completion and just a bit to finish up at the southern end of the project. This project will be transformative for the oil industry in Western Canada, as it will dramatically expand the capacity to export into the Pacific basin, exposing otherwise largely land-locked oil from Western Canada to global markets. That, in turn, should theoretically substantially reduce the dramatic discounts for Canadian heavy oil compared to West Texas Intermediate, the North American benchmark, and more significantly, the global Brent benchmark.
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Coastal GasLink will supply the LNG Canada project, Canada’s first liquefied natural gas export terminal, located at Kitimat. The adjacent Cedar LNG project, which is nearing its final go/no go point, would also use the same pipeline to supply it.
The CAOEC said, “The industry is excited about new opportunities to support the extraction of critical minerals such as lithium, helium, the production of heat from geothermal, and the sequestration and storage of carbon deep underground.”
CAOEC president and CEO Mark Scholz, at the 2023 State of the Industry event. YouTube/CAOEC
Mark A. Scholz, President & CEO of the CAOEC, said in a release, “Today’s rigs can work on a natural gas well in one period, move to a geothermal or carbon storage well in the next, and increasingly drill exploration wells for lithium and helium. By building off of Canada’s world-class drilling technology, the energy services sector is at the epicentre of sustainable jobs and Canada’s energy transformation. Our workforce and technology will lead the way.”
Is this rig drilling for oil, geothermal, potash, helium or lithium? In recent years, Panther Drilling of Weyburn has done them all. Panther Drilling Rig 2 drilled Prairie Lithium’s first well, seen here northwest of Torquay, in late September, 2021. It was the first targeted lithium well drilled in Saskatchewan, and indeed, in Canada. Photo by Brian Zinchuk
On the labour front, applications for entry-level positions are strong, the CAOEC said, indicating a renewed interest in the sector and a positive outlook in the long term. However, senior field positions are in high demand and finding experienced workers to fill those roles has not been easy. These challenges are anticipated to persist in the short and medium term as recruiters continue to market to prospective workers across the country, including Central and Eastern Canada.
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“Decarbonization within the industry will require more pragmatic and balanced climate policy, especially as the world faces the realities of deglobalization and increased geopolitical risk. The Association has been actively working to achieve this by engaging the federal and provincial governments in designing policies that would help accelerate the deployment of carbon abatement technology within the energy services sector. While the federal government has introduced various investment tax credits, the Association has identified critical policy gaps that fall short of the industry’s needs,” the organization said.
Scholz said, “If aspirations are to be turned into investments, Ottawa needs to be more flexible and not choose one sector over another. We are ready to do our part and position Canada as a world leader in carbon emissions efficiency; however, we can only achieve this through policies that recognize the real-life applications of drilling and service rigs.
Here’s the video livestream. Note, there is a LOT of waiting before it starts at 1:24:37. That’s one hour, 24 minutes from the beginning. This link is cued up for that, but if not, fast forward.
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- 0061 SIMSA 2024 For Sask Buy Sask0061 SIMSA 2024 For Sask Buy Sask
- 0055 Smart Power Be Smart with your Power office0055 Smart Power Be Smart with your Power office
- 0051 JML Hiring Pumpjack assembly0051 JML Hiring Pumpjack assembly
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- 0046 City of Estevan This is Estevan0046 City of Estevan This is Estevan
- 0041 DEEP Since 2018 now we are going to build0041 DEEP Since 2018 now we are going to build
- 0032 IWS Summer hiring rock trailer music
- 0022 Grimes winter hiring
- 0021 OSY Rentals S8 Promo
- 0018 IWS Hiring Royal Summer
- 0013 Panther Drilling PO ad 03 top drive rigs
- 0011
- 0006 JK Junior
- 0002 gilliss casing services0002 gilliss casing services
- 9002 Pipeline Online 30 sec EBEX9002 Pipeline Online 30 sec EBEX
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