Canadian drilling activity will be strong in 1995 but drop slightly from the 1994 level, industry spokesmen predict.
The Canadian Association of Petroleum Producers (CAPP) forecasts drilling of 10,500-11,000 wells in 1995, compared with projected drilling of 11,300 wells this year.
CAPP Pres. Gerry Protti said the forecast hinges on no significant drop in natural gas prices in 1995.
Protti cited several factors that point to strong activity in Canadian drilling in 1995. Among them, total cash flow available to companies will be about $10 billion by yearend 1994, and the industry has a record of investing almost 100% of available cash flow.
The CAPP estimate is based on a survey of members and industry consultants, along with Alberta government data. It assumes prices of about $18/bbl for crude oil and $2/Mcf for natural gas, both in U.S. dollars.
The Petroleum Services Association of Canada also issued an upbeat forecast for 1995.
The association, representing service companies, forecasts the drilling of 11,000 wells in western Canada in 1995 and spending of $5.2 billion. It expects spending to total $5.1 billion in 1994, compared with $3.9 billion in 1993.
Dale Tufts, an energy analyst who prepared estimates for the association, said oil drilling is expected to increase 5% in 1995, while natural gas drilling will decline 14% but remain the main target.
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