Canada's crude oil production will rise 50% by 2040, national regulator forecasts

Production of crude oil in Canada will grow nearly 50 per cent by 2040 even though energy use per person will decline by more than 15 per cent, according to a long-term outlook released Tuesday by the Canada Energy Regulator (CER).

The report, Canada'sEnergy Future 2019: Energy Supply and Demand Projections to 2040, examines how new technologies, infrastructure developments and climate policy will impact Canadian energy consumption and production trends over the next two decades.

"The potential for LNG exports is an important driver of natural gas production while oil production growth is led by new phases of existing in-situ projects," said a release from the regulator.

"Canadian oil pricing and production trends will rely heavily on the availability of export pipeline and rail capacity. If approved pipeline projects (Trans Mountain, Keystone XL, Line 3) proceed as announced, along with continued volumes of crude by rail, there will be sufficient takeaway capacity to accommodate production growth over the next 20 years."

The CER outlook forecasts that from 2018 to 2040, crude oil production will grow by nearly 50 per cent to about seven million barrels per day while natural gas production increases by about 30 per cent, to more than 20 billion cubic feet per day over the next 20 years.

It's also believed that natural gas and renewables will significantly displace coal-fired electricity generation, helping to reduce Canada's electricity emissions over the next 20 years.

The outlook also predicts wind and solar power generation will nearly double, but hydro will remain the dominant source of renewable electricity energy in 2040.

On the usage side, the outlook predicts natural gas use the least GHG-intensive fossil fuel will increase by 18 per cent, while oil product use will decline by seven per cent, and coal use declines by nearly 75 per cent.