Drilling for oil and natural gas is expected to rebound strongly across Canada this year, with a leading industry group saying Wednesday that some of the best new numbers are coming out of Alberta.
In its most recent forecast, the Petroleum Services Association of Canada said a total of 9,000 new wells are expected to be drilled across Canada in 2010, a 12 per cent increase over 2009.
The new figure amounts to 1,000 more wells than the PSAC forecast in November, with all of that new activity occurring in Alberta.
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Growth in Alberta had been expected to be flat this year, but officials say that situation has changed with improving economics in the industry, the PSAC said.
It now estimates 6,095 wells will be drilled in Alberta this year, an increase of 4 per cent over final 2009 drilling levels.
Meanwhile, the PSAC expects British Columbia to have 630 wells drilled in 2010, an increase of 10 per cent from last year. Saskatchewan should see an 11 per cent increase to 1,935 wells, while Manitoba can expect a 29 per cent increase to 300 wells.
The PSAC's improved forecast is primarily the result of strengthening prices for both crude oil and natural gas - natural gas prices of $5.50 per thousand cubic feet and crude oil prices of $74 (U.S.) a barrel.
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"Industry is expecting commodity prices to strengthen further this year," said PSAC president Roger Soucy.
"Improved prices led to a spurt in drilling activity in December 2009 and we expect stronger pricing to continue to impact drilling levels as we move through 2010."
The final tally for 2009 was 8,450 wells drilled across Canada.
"We are cautiously optimistic about 2010," Soucy added. "The commodity pricing signals have been positive so far but this may not be the quick and complete turnaround everyone is hoping for. The real test will come after spring break-up."
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The Petroleum Services Association of Canada is the national trade association representing the service, supply and manufacturing sectors within the upstream petroleum industry.