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Updated June 2021

 

Figure S5.7 shows marketable gas demand within Alberta by sector and gas available for removal.

Demand

In 2020

Demand for natural gas within Alberta declined about 2 per cent from 2019, accounting for 59 per cent of marketable production volumes, or 168.9 million cubic metres per day 106 m3/d (6 billion cubic feet per day [Bcf/d]). This is the largest annual decline in total gas demand since 2001 and highlights the impact of the COVID-19 pandemic on economic activity and energy use in the province.

Natural gas demand decreased across most sectors except for the residential and industrial sectors, excluding oil sands and petrochemical facilities. Demand was significantly lower across the electricity generation and oil sands sectors. The decrease in oil sands sector was driven by a decline in bitumen production, a trend that hasn’t occurred since 2008.

Forecast for 2021 to 2030

Total domestic demand for natural gas in Alberta is estimated to reach 223.2 106 m3/d (7.9 Bcf/d) by 2030. Growing at 2 per cent annually, this represents a slowdown relative to the previous decade when demand increased about 3.4 per cent per year.

By end-use sector, gas demand is anticipated to grow over the forecast as follows:

  • Electricity generation is expected to account for almost 50 per cent of the increase in gas use in the province to 2030. This is driven by a forecasted increase in cogeneration at oil sands facilities as well as by coal-to-gas conversions in the power generating sector.
  • Oil sands demand is expected to account for over 40 per cent of the increase in natural gas demand over the forecast, driven by increasing use from oil sands in situ operations.
  • Other sectors combined, including residential, commercial, non-oil sands industrial, and transportation, will account for the remaining growth in demand. Demand is expected to increase at an annual rate near or below one per cent, driven up by economic and population growth, and offset by energy efficiency gains.

Removals

In 2020

Following a decline over two consecutive years, natural gas removals from Alberta, as transfers to other provinces and exports to the U.S., increased by 2 per cent in 2020. This was due to steady marketable gas production levels and a decline in domestic use.

Forecast for 2021 to 2030

Removals are estimated to decline steadily over the forecast at 5 per cent per year, to 67.3 106 m3/d (2.4 Bcf/d) by 2030, which is consistent with the 5 per cent annual decline over the past decade. This will occur as domestic demand is expected to grow over the same period and production increases only moderately.

Various projects are in the works to improve market access for western Canadian natural gas. Alberta’s natural gas will increasingly compete for pipeline capacity with rising production from British Columbia, where producers are also likely to benefit most from liquefied natural gas (LNG) export projects. However, an overall increase in market access over the forecast will directly benefit Alberta producers via reduced infrastructure congestion and improved commodity pricing.

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