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Mining and Oil and Gas Extraction

Energy helps to drive Alberta's economy. The province's oil sands are the third largest proven crude oil reserve in the world, after Saudi Arabia and Venezuela. Only about 3.4% of these oil sands can be mined. The other reserves are too deep and must be extracted by other methods. Alberta also produces about 68.0% of Canada's natural gas.

GDP Gross Domestic Product

Gross domestic product (GDP) measures the overall size of an economy. In 2015, the mining and oil and gas extraction industry made up 27.4% of Alberta's GDP. This is a 4.1% increase from 2013.

Alberta’s GDP
27.4%
Increase from 2013
4.1%
Sectors
  • exploring for and producing crude petroleum and natural gas
  • drilling and equipping wells
  • mining for coal or metal ore
  • support activities for the industry
Workforce
12.6%

The mining and oil and gas extraction industry employed 135,800 people in 2016. This is a decrease of 19,500 jobs or 12.6% from 2015.

75%
75%

102,300 men worked in the industry in 2016 (down 14,300 jobs or 12.3% from 2015)

25%
25%

33,500 women worked in the industry in 2016 (down 5,200 jobs or 13.4% from 2015)

Average Wage
Mining and Oil and Gas Extraction
Average Hourly Wage
Provincial
Average Hourly Wage
  • The average 2016 hourly wage of $42.80 for the mining and oil and gas extraction industry was above the provincial average of $29.61.
Industry Performance

Low oil prices in 2015 and 2016 resulted in the industry shrinking for two years as energy companies cut investment and jobs. Some companies cut billions from their capital plans.  Others, like Royal Dutch Shell and Norway’s Statoil, pulled out of the oil sands altogether. But as crude oil prices recover, investment will increase.

Increased production from shale gas formations has allowed Alberta’s natural gas production to grow slightly. The difficulty is finding markets. Alberta’s main buyer is the United States, which is also rich in natural gas.

Industry Outlook

Suncor Fort Hills and CNRL Horizon Phase 3 are two major mining projects scheduled to open in 2017. Expansion of the oil sands and the construction of new pipelines should increase exports to international markets by an average of 3.1% a year over the next decade. By the end of 2018, the price of West Texas Intermediate crude is expected to rise to almost $60 (U.S.). The Conference Board of Canada, a non-profit research organization, predicts that bitumen or non-conventional oil production will climb from 2.4 to 4 million barrels per day between 2015 and 2040.

The organization also predicts that non-conventional oil will account for 86% of all crude oil produced in Alberta by then. The Conference Board argues that conventional oil reserves are now being found in harder-to-access areas, which means that production happens at a lower rate and is more expensive.

The difficulty of finding markets for natural gas south of the border will mean that it will have to be used somewhere else — probably as an energy source for oil sands production. In the long-term, natural gas production will drop from its current level of 10 billion to 9.3 billion cubic feet per day by 2040.

Some of the natural gas may also be used in electricity production. This would be part of the provincial government’s commitment to phasing out coal-fired electricity pollution by 2030.

Industry Employment Trends
1.1%

Employment in this industry is expected to grow at an average rate of 1.1% from 2016 to 2019.

OCCinfo has more information about occupations in Alberta, including details about duties, working conditions, educational requirements, employment outlook, and salary ranges. You can also find reports on region-specific information about wages, job vacancies, and hiring difficulties in this industry. Visit the Survey Analysis to learn more.

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