| June 2006 |
The Oil and Gas Extraction industry employed about 58,000 Albertans in 2005. The industry is expected to grow by a yearly average of 3.3 per cent, employing about 68,400 in 2010.
Industry Outlook (Adapted from Alberta Careers Update 2004)
Despite being a cyclical industry, the outlook for the Alberta Crude Oil industry remains positive. Conventional crude oil production likely will continue to decline but bitumen, synthetic crude and natural gas liquids are expected to show strong growth. High commodity prices likely will continue due to ongoing tension in the Middle East, the uncertainty of the Russian oil supply and increasing global demand.
In the future, the industry will rely more on the development of higher cost heavy oil and bitumen reserves and less on cheaper conventional oil production. Oil sands production has surpassed conventional oil production in Alberta. Many heavy oil and bitumen projects are capital and labour intensive and will lead to growth in other areas. These projects will require investments in oil upgrading facilities and pipelines to get products to market. However, these massive projects also can create and be impacted by shortages of skilled workers.
There are many planned expansions for major oil-producing companies in the Fort McMurray area. The costs of extracting mineable reserves and in-situ reserves of bitumen will continue to drop as companies use new technology and more efficient production methods to enhance resource development. Due to a strong industry outlook, many of these technologies and methods will continue to be developed. Edmonton will play a major role in providing equipment and services to these developments. Calgary will remain the location of choice for the headquarters of many oil and gas companies.
One challenge in the Crude Oil industry is a shortage of workers. Having too few engineers, geoscientists, project managers, construction tradespeople and heavy-duty mechanics is jeopardizing major projects. The Alberta government is responding to industry’s needs through its support of the apprenticeship and industry training system and through a Temporary Foreign Workers agreement with the federal government. But shortages continue to be expected during peak growth periods.
The outlook for the Natural Gas industry in the North American economy looks bright. Alberta accounts for over 80 per cent of Canadian natural gas production. Half of Alberta’s natural gas production is exported to the United States. A quarter of the production is exported to other provinces. Demand for exported Alberta gas will rise significantly as natural gas producers in the United States struggle to keep pace with demand. Such demand will reduce Alberta’s natural gas reserves but will generate exploration and development along with more processing plants, pipelines and storage facilities.
Natural Gas in Coal (NGC), also known as coal bed methane, is a relatively new venture in Alberta. The feasibility of NGC production is not completely known but there is potentially 500 trillion cubic feet (over double the reserves of traditional natural gas) of NGC in Alberta.
Work in this industry
Alberta occupational profiles that describe various types of work in this industry are listed in OCCinfo's Search by Industry: Oil and Gas Extraction
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