Updated March 2018
Butanes production is projected to vary over the forecast period but is expected to increase slightly from 2017 levels by 2027, reaching 16.3 103 m3/d (102.6 103 bbl/d), as shown in Table S6.2 [HTML], as producers are expected to continue drilling in economically attractive liquids-rich gas plays such as the Duvernay and Montney Formations. Although the volumes produced in Alberta are expected to increase slightly, producers are also opting to leave butanes as part of a natural gas liquids mix for removal from Alberta. Mixes containing butane and propane are referred to as liquefied petroleum gas (LPG) and are used primarily as fuel sources for heating and cooking appliances and for vehicles. Butanes production is forecast to increase year over year from 2017 until 2021, when butanes production begins to decline by an average of 2.2 per cent per year until 2027, in line with the natural gas production forecast.
The North West Redwater Partnership Sturgeon refinery, scheduled to begin operating in early 2018, will provide another source of butanes, albeit very small.
The petrochemical industry uses butanes as feedstock to create value-added products such as an octane additive for gasoline and methanol. Butanes demand by the petrochemical industry increased 5.3 per cent, from 7.6 103 m3/d (47.9 103 bbl/d) in 2016 to 8.0 103 m3/d (50.4 103 bbl/d) in 2017, and is projected to remain at the same level throughout the forecast barring the addition of new facilities that consume butane.
Butanes demand for nonupgraded bitumen and heavy oil blending was flat between 2016 and 2017, but demand is projected to increase in line with the nonupgraded bitumen forecast, growing from 5.4 103 m3/d (34.0 103 bbl/d) in 2017 to 7.9 103 m3/d (49.7 103 bbl/d) in 2027, a 46.3 per cent increase. Refinery demand for butanes, which are used for the production of refined petroleum products, is projected to remain flat throughout the forecast, at 3.3 103 m3/d (20.8 103 bbl/d).
Butanes can also be used as a solvent in SAGD bitumen production, resulting in reduced carbon emissions and lower water and energy consumption. Butanes use in SAGD amounted to less than 1 per cent of the provincial demand in 2017, and their use as a solvent in SAGD production decreased 28.5 per cent in 2017 compared with 2016.
Total butanes demand is forecast to increase to 15.8 103 m3/d (99.5 103 bbl/d) in 2027 corresponding with an increase for blending with nonupgraded bitumen.
More information on the butanes forecast can be found in the Methodology section.