Alberta’s oil production hits all-time high in 2023, ahead of China but behind Iraq

Rumours of Alberta’s demise as an oil producer appear to have been greatly exaggerated.According to the Alberta Energy Regulator (AER) crude oil output hit a record high of 4.2 million barrels per day (bpd) in November, which makes it the sixth largest oil producing region in the world — ahead of China but behind Iraq.Canada as a whole is fifth, at around 4.8 million bpd and that figure is poised to climb about 500,000 bpd to 5.3 million bpd in 2024 once the Trans Mountain pipeline expansion comes on stream.Last week the Canadian Energy Regulator (CER) approved a variance request that will see completion of the final segment between Chilliwack and Hope by the first quarter of this year. The $30.9 billion project is about 98% complete and will provide another 600,000 bpd of incremental capacity, including the first exports off Canadian shores.According to Eight Capital analyst Phil Skolnick, Canadian oil production volume would have likely hit the wall the second half of this year without the addition of the Trans Mountain project..That in turn is having a positive impact on the price of Alberta’s signature Western Canadian Select (WCS), which was up almost 3% on Wednesday to USD$56.77 a barrel compared to $71.77 for US West Texas Intermediate (WTI), which was down about a nickel.That means the price differential has shrunk from $17.95 to around $15 in less than three days after the CER ruling and the hopes that Trans Mountain can begin filling the line with oil as soon as March.“The decision is a huge relief, not only for TMX, but also for producers and shippers on the pipeline who desperately need incremental takeaway out of the basin,” TPH Energy Research analysts said in a note, adding that TMX hoped to begin filling the pipeline with crude by the end of March.Overall Alberta output averaged about 3.8 million bpd through the first 11 months of last year, up 1.6% from 2022 and 5% from the same period in 2021.