Oil and Gas Developments in Western Canada in 1984

Abstract

ABSTRACT Petroleum industry activity in western Canada during 1984 rebounded strongly to near-record levels, with the third successive annual increase following the 1981 slump. The year was marked by increased development drilling -- especially in Saskatchewan, further emphasis on in situ heavy oil wells, and a continuation of government incentives. Total number of wells drilled increased by 30% to 8765. Exploratory drilling reversed a three-year decline by rising 45% to 2863 wells. Development drilling reached a record 5902 wells, up 23% over 1983 and 15% over the 1980 record. Exploratory success rate decreased from 62% to 60%, with 1089 oil discoveries and 637 gas discoveries. The development success rate remained at 89%, with 4010 oil completions and 1228 gas completions. Exploratory drilling rose sharply in every area except Manitoba, and development drilling increased in all areas. Average well depths rose marginally in every province but Manitoba. Land sale revenue continued to soar, increasing by 44% to $812 million3, but still below the 1980 peak of $1311 million. Alberta land sale revenue totalled $624 million, Saskatchewan $124 million, British Columbia $62 million and Manitoba $2.5 million. Average price per hectare declined in the two most active areas, Alberta and Saskatchewan, but increased in British Columbia and Manitoba. Alberta exploratory and development drilling reversed a three-year decline and totalled 61% of western Canadian activity. Most of the significant discoveries were made in Devonian carbonates in the Chigwell-Bashaw area, Slave and Kitty areas, Peerless Lake, Rainbow-Shekilie and Dizzy Creek - Steen River areas. A new Lower Cretaceous clastics pool was discovered at Manyberries. Further development and expansion of oil sands projects were announced by Shell Canada in the Peace River area, by Suncor at Fort McMurray and by Esso at Cold Lake. British Columbia activity was centered around last year's Mississippian oil discovery at Desan and another Mississippian gas find at Sikanni. Also, significant CO2 reserves were found by Shell in the Flathead area, just north of the Montana border, and interest increased in west coast offshore potential, despite a 12-year moratorium. Saskatchewan activity expanded sharply for both exploratory and development wells, and was concentrated on the Lower Cretaceous Viking play in the Kindersley-Kerrobert area, Lower Cretaceous heavy oil development at Lloydminster, and a Mississippian play in the Midale-Estevan area. Husky Oil finally announced plans to proceed with a $3.2 billion heavy oil upgrader near Lloydminster. Frontier activity reached record levels due to a continuation of the federal Petroleum Incentives Program and Esso's major development program at Norman Wells. Significant discoveries were made in the Beaufort region, with oil and gas found in a large fault-bounded structure at Amauligak in the Mackenzie Delta offshore, and the largest wet gas discovery onshore at Tuk on the Tuk peninsula. Other Beaufort oil discoveries at Pitsiulak and a Tarsiut delineation well were not as large as expected. Only one of four Arctic Islands wells, namely a stepout well in the Skate oil and gas field off Lougheed Island, was a discovery. The year 1984 marked a return to better times, and all indications point to even greater drilling activity in 1985. RESUME DEVELOPPEMENTS PETROLIER DANS L'OUEST CANADIEN, 1984 Nous regrettons extrement le manque d'une version francaise de cet article assez tot pour la publication. Une version fera imprimee dans le numero prochain (v. 34, no. 1), sur une page a part. 1 Also printed in American Association of Petroleum Geologists Bulletin, v. 69, p. 1491-1500. 4 Money in Canadian dollars Valuable data were obtained from the Canadian Petroleum Association, Canadian Oil Scouts Association, Oilweek and Nickle's Daily Oil Bulletin. We extend appreciation to E. M. Manko, J. Hogg, R. J. Knight and I. A. McIlreath for critical review, to Petro-Canada's Graphics and Design Group for drafting the illustrations, and to Jan Brown and Diana Gillrie for typing the original manuscript. End_Page 410------------------------