Natural gas prices are up. Is anyone ever going to drill again for gas in Saskatchewan?

Brian Zinchuk

Brian Zinchuk is editor and owner of Pipeline Online

Source: Saskatchewan Ministry of Energy and Resources

These days, any gas development in this province is almost always from associated gas production – the natural gas that comes up with oil. On March 14, Minister of Energy and Resources Bronwyn Eyre announced two new programs for increasing gas collection.

When asked on March 15 when the last targeted gas wells were drilled in Saskatchewan, Eyre said, “In the last five years, there has been three. In 2017, zero. In 2018, two. In 2019, zero. One well in 2020. Zero in 2021. 2022 to be seen.”

That’s a far cry from what we used to drill. In 2002 we peaked at 2,318 gas wells drilled. A slow decline lowered that number to 1,230 in 2008. But the fracking revolution opened up massive gas development in Alberta and British Columbia, and especially in the United States, causing gas prices to fall off a cliff. The wheels fell off for Saskatchewan in 2009, with just 233 wells, followed by 98, 50, 10, and then 5. By 2016, targeted gas drilling had totally flatlined to zero wells drilled that year.

But natural gas prices are up these days. On March 16, GasAlberta.com reported a price of $4.45 per gigajoule, basically double what it was during the great drought of natural gas drilling in Saskatchewan. The energy crisis in Europe, and now a war in Ukraine, has caused natural gas prices overseas to skyrocket. (Canada does not have any water-borne liquified natural gas capacity at this time, so we are isolated from those markets.)

With the rising price of natural gas, does the minister think there could be a revival of targeted gas drilling?

Eyre responded, “Well, anything is possible. And I think that there certainly will be, understandably increased interest and focus on gas as a result of that. And so, we’ll have to see where things develop.”

But the focus of the March 15 announcement was to assist getting more information out there about where gas is at, with regards to associated gas, and where it makes more sense for producers to work together to capture and commercialize it.

She pointed out a 15 megawatt new natural gas to power facility near Kindersley spearheaded by Flying Dust First Nation made use of this mapping system.

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