Three, five and 10-year megatrends
"Project 3-5-10" was conceived in 2013 to identify emerging megatrends that individually or in aggregate have the potential to transform and/or disrupt business practices in the upstream oil and gas industry three, five and ten years from now.
The project is led by Peter Tertzakian at ARC Financial Corp, and is guided by a steering committee with representatives from government and industry associations, including CAPP. The project consists of a series of stakeholder roundtables designed to elicit feedback on emerging issues and trends, with this information applied to future growth scenarios to understand the potential impact and severity of these trends on Canada's upstream oil and gas industry.
The intent of "Project 3-5-10" is to create a continuous process of ongoing monitoring and review so as to stay on top of key developments in the industry.
The Canadian crude oil industry is facing risks on multiple fronts in a market transformed by increased global crude oil supplies resulting in lower oil prices. These market forces are the primary driver of our revised outlook. Lower oil prices have challenged project economics and reduced capital spending intentions. These constraints have dampened the outlook for future production growth. Against this changed backdrop, highlights of this year’s outlook are:
- Total oil production continues to grow but at a slower pace than previously anticipated.
- Total Canadian production grows from 3.85 million b/d in 2015 up to 4.9 million b/d in 2030.
- Market diversity and access is still required to the U.S. Gulf Coast, the U.S. Midwest and Eastern Canada in North America. International interest in accessing Canadian crude oil is also increasing as several test cargoes were shipped to global markets in both Asia and Europe in 2014.
- The timely development of infrastructure to obtain market access is a continuing concern. The in-service dates for many of the pipeline projects have already been delayed and could be even further delayed due to extended regulatory processes. Transport of crude by rail has been growing in importance. The growth of rail beyond 2018 will primarily depend on the availability of pipeline capacity.