Abundant Canadian Reserves Targeted for Export
Canadian business and government energy representatives assured
a Washington audience last week that the immense Canadian reserves
and strong market ties between the U.S. and Canada spell long-term
supply security for U.S. consumers.
Canadian Energy Minister Ralph E. Goodale put total Canadian
recoverable reserves at between 504 and 617 Tcf, and pointed out
that current annual production is only 5.7 Tcf. That adds up to
"enough for both Canada and export demand well into the future,"
Goodale said. Exports in 1997 were 2.9 Tcf. And Canada will
continue to make its reserves available. He said much of his
nation's economic recovery-the "Maple leaf miracle" - is based on
its energy production and promised the marketplace will be allowed
to determine supply and demand without undue government
Energy is just one portion of the "integrated North American
market...the largest and most lucrative market in the free world,"
Goodale said. He spoke to a meeting for producers and government
officials hosted by the Natural Gas Supply Association and the
Canadian Petroleum Association at the Canadian Embassy in
"We're long on pipe, not short on supply," advised Norman
McIntyre, executive vice president of Petro-Canada, responding to
doubts that Canadians will be able to fill all the new export
pipelines being built. He acknowledged the pipes may not be filled
immediately, but pointed out the Western Canada Sedimentary Basin
"has doubled its estimated supply of natural gas over the past 20
years, in spite of long periods of stagnant demand, low drilling
levels and export prices that declined from $5 to, at one point, 85
cents(U.S.)." Canadian production "time and again has exceeded
expectations," he added.
That excess Canadian production may be needed if oil and gas
prices continue on their current course and U.S. producers continue
to pare their drilling budgets.
Meanwhile U.S. producers don't want to see any artificial hyping
of the market through the imposition of excessive environmental
standards. While the production is available to meet currently
forecast markets, it would be impossible to meet the requirements
if the Kyoto environmental protocol is implemented, according to
Don Niemiec, Union Pacific Resources vice president.
"According to an analysis performed by EIA, in order to meet the
carbon reduction targets in the Kyoto protocol, coal-fired electric
generation would have to drop by as much as 75%. And gas-fired
generation - primarily from increased use of highly efficient new
gas combined-cycle plants - would grow 76%." Niemiec told the group
the U.S. would need more than 6 Tcf of additional natural gas
supplies a year to fuel such increases.
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