Commodities
Home›Commodities›Energy›Canada’s Alberta shifts toward Clearwater heavy oil as…
Canada’s Alberta shifts toward Clearwater heavy oil as drilling accelerates
Alberta approved 1,764 drilling licenses from Jan. 1 to June 12, with about one-fifth aimed at the Clearwater formation, the highest share on record.
Canadian heavy-oil producers in Alberta are increasingly steering new drilling toward the Clearwater formation as higher crude prices make faster output more attractive, according to Bloomberg, as summarized by OilPrice.
Instead of tying up billions in long-term oil sands projects, Clearwater is a conventional heavy oil play that produces similar crude using horizontal multilateral wells. That approach reduces reliance on steam-assisted extraction, allowing companies to ramp production more quickly than traditional oil sands development.
Alberta approved 1,764 drilling licenses between Jan. 1 and June 12, the busiest start to a year since 2014. Approximately one-fifth of those permits were for Clearwater wells, marking the highest proportion ever recorded, the outlet said.
Bloomberg also cited CEO Brian Schmidt of Tamarack Valley Energy, saying the economics are compelling and that the play requires relatively little capital to get started. The report added that Clearwater growth is helping smaller Alberta producers, including Tamarack Valley and privately owned Spur Petroleum, rise into major players despite facing larger oil sands operators.
Latest closeWTI crude $81.23 ▼1.7%