N.W.T. has 40% more natural gas than estimated: NEB

The National Energy Board says the Northwest Territories has 40 per cent more natural gas than previously assessed enough to supply the country for five years but that doesn't mean it will be leaving the territory anytime soon.

Crude oil is now selling for less than $75 dollars a barrel, andCanada's demand for natural gas is already being filled.

One thing we dont need in the North American market right now is more natural gas, says Doug Matthews, an energy analyst based inCanmore, Alta., who has been working in the territory for decades.

The NEB's latest estimate, the first since 1998,says the N.W.T. issitting on about 467 billion cubic metresof natural gas.

"When you do the analysis over the 16 years you gain a better understanding of the reservoirs and so you change your assumptions from one assessment to the next," says Mike Johnson, who did the technical review of the report for the NEB.

The new numbers estimatethe amount of discovered oil, natural gas and liquid natural gas in the territory and the Beaufort Sea. The assessment did not include any shale oil, which is considered unconventional because it has to be extracted by means such as fracking.

The NEB reached the numbers byreviewing data from wells and maps as well as compiling information from industry. Estimates were also made using probability formulas.

Much of the increase to the natural gas assessment is attributed to a change in the estimate for the Amauliak field in the Beaufort Sea, about 75 kilometres north of Tuktoyaktuk.

It's not going to market in the near term.- Doug Matthews, energy analyst

The NEB also says there's 11 per cent less crude oil than previously thought. Johnson says there hasn't been much oil discovered since 1998 and they refined their assumptions about the previous discoveries.

Its not much oil in the grand Canadian scheme of things, said Johnson. But its a significant amount of natural gas.

But much of the territory's resources will remain trapped under tundra and sea ice,at least for now.

While it's good to know the reserve is there, and appears to be growing, as the NEB gets more information about the reserve, it's not going to market in the near term,"says Matthews, the analyst.

Matthews says theres far too much competition from southern suppliers that are both larger and closer to market, and therefore cheaper to produce.

But as those reserves get used up, the northern ones look attractive as a back up."

Matthews isn't discouraged.

He says this assessment is a reminder to industry of just how much potential the territory has, particularly when it comes to crude oil.

At the present time that resource base may not be economical to develop, but it's important to keep reminding industry that it does indeed exist, he says.

When the economic situation changes those reserves could be very attractive to southern or foreign markets.

Matthews says the NEB's numbers may also pique industry's interest more than a pitch from a government focused on promoting resource development.