On December 11 2008 the Alberta Provincial Government released a report entitled, “Launching Alberta’s Energy Future – Provincial Energy Strategy”.[1] The news release announcing the strategy said that, “a long-term action plan for Alberta to achieve clean energy production, wise energy use and sustained economic prosperity”.[2] Provincial Energy Minster Mel Knight claimed the energy strategy would propel Alberta to, “global energy leader that is recognized as world-class energy supplier, energy technology champion, and a responsible energy consumer and environmental citizen”.[3]
Alberta has expanded oil production by 26.6% since 2001 adding 367,000 bbls/day of total production. During this period, conventional light oil and heavy crude declined by about 27%, shedding 196,000 bbls/day of total production. Oil sands production increased dramatically by 82.4% to 1.2 million bbls/day. In 2007 Saskatchewan produced 426,000 bbls/day of conventional oil or about 42% of western Canadian conventional production. Saskatchewan produces almost 50% more conventional heavy oils than Alberta. Alberta produces approximately 52% of the total conventional western Canadian supply of 1.017 million bbls/day. Combined Alberta and Saskatchewan account for 78% of Canada’s 2.753 million bbls/day 2007 production levels. Over this period total Canadian oil production increased by 24% adding 533,000 bbls/day of production. What is surprising about these figures is that Eastern Canada accounted for 41% of the increased capacity adding 220 bbls/day of production.[4]
According to the Alberta Provincial Energy Strategy document the energy sector is the single largest contributor to the provincial GDP and accounts for two-thirds of provincial exports. Examining industry Canada data over the last 10 year period from 1998 to 2007 and comparing exports to Alberta’s ten largest trading nations and reviewing the top 25 export products it can be seen that energy exports[5] have jumped from $14.6 billion to $52.9 billion – a 261% increase. In 2007 the Industry Canada data showed that made up 67.6% of total exports.
Total exports from Alberta increased 172% to $78.3 billion from $28.7 billion. Exports for all other products over the same 10 year period grew from $14 billion to $25.3 billion or an 80% increase. In realative terms however non-energy exports declined as a total percentage of all exports. In 1998 all other products made up just fewer than 50% of Alberta exports. In the year 2007 this percentage had dropped to 32.4%.
Over the same period the share of energy (oil and natural gas, excluding electricity) as a total of all Canadian exports has risen from 6% in 1998 to 20% in 2007. The volume has increased to almost $83 billion. Auto manufacturing has declined as a total percentage of total Canadian exports from 19.3% to just 0ver 13% in 2007. The total value of auto exports in dollars in 2007 was $55.5 billion.
Energy is now the single largest share of Canadian exports. It eclipsed auto in 2005. The graphs below show the changes in Alberta exports (Graph 1) and the increase in energy as a total of Canadian exports (Graph 2).
Graph 1
Graph 2
[1] Government of Alberta, “Alberta’s Provincial Energy Strategy 2008”, December 11, 2008, http://www.energy.alberta.ca/Org/pdfs/AB_ProvincialEnergyStrategy.pdf
[2] Government of Alberta News Release, “Provincial Energy Strategy charts course for sustainable prosperity”, December 11, 2008, http://alberta.ca/ACN/200812/24926232C684C-E7DE-976F-01D37383CE0F8F0C.html
[3] Government of Alberta News Release, “Provincial Energy Strategy charts course for sustainable prosperity”, December 11, 2008, http://alberta.ca/ACN/200812/24926232C684C-E7DE-976F-01D37383CE0F8F0C.html
[4] Canadian Association of Petroleum Producers, “Crude Oil Forecast, Markets & Pipeline Expansions”, June 2008, http://www.capp.ca/raw.asp?x=1&dt=NTV&e=PDF&dn=138295
[5] Industry Canada product codes: 270900 - CRUDE PETROLEUM OILS AND OILS OBTAINED FROM BITUMINOUS MINERALS, 271121 - NATURAL GAS IN GASEOUS STATE
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