Despite volatile oil and natural gas prices, at least one industry association is forecasting a strong near-term outlook for oil and gas services for the rest of this year and into next, including emerging renewable energy tech..Enserva — the Energy Services Association of Canada — described the ‘State of the Industry’ as “encouraging” in its latest industry report released Wednesday..In it, the group said global energy demand is strong, oil and gas prices are favourable, inflation and labour shortages are on the decline, and capital investment is on the rise. In addition, the industry is aptly positioned to take advantage of opportunities to participate in the evolving global energy mix..“We’re extremely pleased with the forecast and what this means for the industry and our members,” said Gurpreet Lail, the association’s president and CEO. .“Global oil and gas demand continues to increase and the Canadian industry will continue to be a meaningful and growing contributor to meet long-term energy needs, particularly in Western Canada. At the same time, the energy services sector is strongly positioned to take an important role in the evolving energy mix as more of our members invest in clean carbon technology solutions to meet growing demand.”.Conventional oil and gas is poised to benefit from economic improvements in commodity pricing and costs, coupled with an 11% bump in producer capital spending. .Alberta expected to benefit most from higher levels of capital expenditures while British Columbia will see increased drilling due to current and prospective liquified natural gas (LNG) projects, including the province’s agreement with the Blueberry River First Nation. .In Saskatchewan, the increase in activity will be mostly associated with higher levels of oil development in the southeast part of the province..Service companies expect to see labour pressures alleviate in 2023 due to higher in-migration from other areas of the country, improved workforce planning and better cost management, and could conservatively grow by as much as 4,000 jobs over 2022 levels, it said..The report sets the stage for a higher drilling forecast later in the fall, which it will release in September. As of today, total wells drilled are expected to increase 12% to 6,180 from 5,500 in 2022 while total metres drilled are forecast to jump 14% to 20 million from 17.5 million in 2022..The renewable sector is also poised for growth. Enserva said people involved in traditional energy development will be at a huge advantage for jobs as the underlying technical skills required to extract, develop, produce, process and export oil and gas are transferable to different forms of energy such as wind, solar, biomass and LNG..Longer term traditional oil companies plan to invest substantially in carbon reduction technologies and infrastructure, and service companies will be able to apply their expertise to the development of hydrogen, geothermal and critical minerals as those industries advance..“While there will continue to be a meaningful role for oil and gas in the long-term, renewable energy demand and mineral requirements are going to provide an attractive growth market for Enserva members to add to their portfolios,” says Lail..“The key will be to ensure the energy service sector can take advantage of these opportunities through enabling government policies that create the right conditions to invest.”.Enserva was formerly the Petroleum Services Association of Canada (PSAC) which changed its name in September of 2022.
Despite volatile oil and natural gas prices, at least one industry association is forecasting a strong near-term outlook for oil and gas services for the rest of this year and into next, including emerging renewable energy tech..Enserva — the Energy Services Association of Canada — described the ‘State of the Industry’ as “encouraging” in its latest industry report released Wednesday..In it, the group said global energy demand is strong, oil and gas prices are favourable, inflation and labour shortages are on the decline, and capital investment is on the rise. In addition, the industry is aptly positioned to take advantage of opportunities to participate in the evolving global energy mix..“We’re extremely pleased with the forecast and what this means for the industry and our members,” said Gurpreet Lail, the association’s president and CEO. .“Global oil and gas demand continues to increase and the Canadian industry will continue to be a meaningful and growing contributor to meet long-term energy needs, particularly in Western Canada. At the same time, the energy services sector is strongly positioned to take an important role in the evolving energy mix as more of our members invest in clean carbon technology solutions to meet growing demand.”.Conventional oil and gas is poised to benefit from economic improvements in commodity pricing and costs, coupled with an 11% bump in producer capital spending. .Alberta expected to benefit most from higher levels of capital expenditures while British Columbia will see increased drilling due to current and prospective liquified natural gas (LNG) projects, including the province’s agreement with the Blueberry River First Nation. .In Saskatchewan, the increase in activity will be mostly associated with higher levels of oil development in the southeast part of the province..Service companies expect to see labour pressures alleviate in 2023 due to higher in-migration from other areas of the country, improved workforce planning and better cost management, and could conservatively grow by as much as 4,000 jobs over 2022 levels, it said..The report sets the stage for a higher drilling forecast later in the fall, which it will release in September. As of today, total wells drilled are expected to increase 12% to 6,180 from 5,500 in 2022 while total metres drilled are forecast to jump 14% to 20 million from 17.5 million in 2022..The renewable sector is also poised for growth. Enserva said people involved in traditional energy development will be at a huge advantage for jobs as the underlying technical skills required to extract, develop, produce, process and export oil and gas are transferable to different forms of energy such as wind, solar, biomass and LNG..Longer term traditional oil companies plan to invest substantially in carbon reduction technologies and infrastructure, and service companies will be able to apply their expertise to the development of hydrogen, geothermal and critical minerals as those industries advance..“While there will continue to be a meaningful role for oil and gas in the long-term, renewable energy demand and mineral requirements are going to provide an attractive growth market for Enserva members to add to their portfolios,” says Lail..“The key will be to ensure the energy service sector can take advantage of these opportunities through enabling government policies that create the right conditions to invest.”.Enserva was formerly the Petroleum Services Association of Canada (PSAC) which changed its name in September of 2022.
