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Manitoba industry hits revenue record in 2012, surpasses usual leader
For the first time, Manitoba’s oil industry has bragging rights over its resource cousins in the mining sector. In 2012, oil-industry revenue slightly nudged mineral-production receipts for top spot in Manitoba –$1.51 billion in oil and about $1.4 billion in nickel, copper, gold zinc and the rest of the underground miners’ production.
Last year, 18.5 million barrels of oil were produced. That’s 23 per cent more than 2011 and it has been growing by more than 20 per cent annually since 2005.
John Fox, assistant deputy minister of mineral resources for the Department of Innovation Energy and Mines, said there is no reason to think production won’t increase again this year.
“At 222 wells drilled already this year, we’re slightly ahead of last year,” Fox said. “We anticipate a similar 10 to 20 per cent increase in production in Manitoba in 2013. It’s not dying down.”
Manitoba’s oil production is restricted to the southwest corner of the province along the northeastern flank of the Williston Basin that extends into Saskatchewan, North Dakota, South Dakota and Montana.
Although geographic coverage is small in Manitoba compared with those jurisdictions, the growth in Manitoba’s oil production since 2005 has been far greater than the conventional oil production in Saskatchewan and Alberta.
Compared to a 257 per cent increase in Manitoba since 2005, Alberta’s conventional oil production has increased by just nine per cent in that time period (that doesn’t include huge production increases in the oilsands). In Saskatchewan, oil production was up about 42.5 per cent during that period.
Both those provinces outstrip Manitoba in sheer volume of production — Alberta pumps eight times more oil than Manitoba (not including oilsands) and Saskatchewan’s production is four times greater — but Manitoba’s industry has taken off during the past several years.
The introduction of horizontal drilling and fracturing has been a boon here. Virtually all oil wells in Manitoba now use “fracking” — the technique of shooting water then “fracking” a sand mixture deep into the shale rock to keep the cracks open to extract the oil. The tiny oilpatch in Manitoba has caught the eye of industry observers.
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