Oil and Gas Extraction and Mining Support Activities

June 2006

The Oil and Gas Extraction and Mining Support Activities industry employed about 59,900 Albertans in 2005. The industry is expected to grow by a yearly average of 1.8 per cent, employing about 65,500 in 2010.

drilling and completing oil and gas wells
test drilling for minerals other than oil and gas
servicing oil and gas wells (for example, acidizing, cementing, logging)
draining, stripping or providing other mine services.

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.

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.

Coal mining continues to play a major role in Alberta’s economy. Coal’s dominant role in the global energy mix, together with its responsibility for a share of carbon dioxide (CO₂) emissions, focuses attention on how use coal in a way that results in the least amount of harm to the global climate.

Alberta produces three types of marketable coal:

metallurgical bituminous which is exported and used for industrial applications such as steel making
thermal bituminous which is exported and used to fuel electricity generators in distant markets
sub-bituminous which is used mainly for electricity generation in Alberta.

Fierce international competition has had an obvious impact on this industry. Some Asian-Pacific countries are now purchasing coal from Australia, a direct competitor with Alberta.

Despite Canadian mines being relatively high-cost on the global scale, metallurgical coal mining is back on the upswing in Alberta due in part to the rebound in world prices. A full economic recovery in the Asian-Pacific region will likely be necessary to bring the market back to a better balance between supply and demand.

The outlook for thermal coal is more encouraging due to its higher productivity when burned.

Sub-bituminous coal which accounts for 90 per cent of Alberta’s production continues to fuel the province’s power plants and play a major role in keeping Albertan’s power prices at reasonable levels.

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 and Mining