Deciphering oil industry statistics is a bit like reading tea leaves – you have to know what to look for. When Amy Jordan looks at the indicators, she sees good things to come.
Jordan is Acting Director of the Manitoba Petroleum Branch. Part of her job is to understand the language of crude, like how to convert $/M3 to $/BBL and the difference between Brent, WTI (West Texas Intermediate) and LSB (Light Sour Blend). And, importantly, what it means for us at the centre of Manitoba’s oil industry.
While Jordan doesn’t profess to be a crystal ball gazer, she does monitor companies that are in the business of foretelling the future of oil.
Based on their analysis, $100 a barrel is not on the radar, Jordan says, but “over the next few years, they predict levels will stay close to where they are now, more in the $73-75 range.” Which is a far cry from the $40 a barrel nosedive we saw in 2016.
"It seems like things are inching upwards – prices, drilling licences issued, number of wells drilled – it all indicates there's an uptick in the industry for sure."
Activity, prices up
“The prices are going up, and at same time, so is activity in the industry," Jordan says. She points to the bump in prices paid for Cromer LSB between 2017 to 2018.
“The average monthly price of oil in the first ten months of last year was $62. This year over the same period it averaged $78 a barrel.”
Another way to read the oil industry tea leaves is by comparing drilling licenses. Jordan says they’re a good benchmark of the overall health of Manitoba’s petroleum industry.
At this time last year, about 150 drilling licenses had been issued in Manitoba. In 2018 so far, the number has jumped to 190.
Jordan says, “If that keeps pace, we’ll have more licenses by the end of this year than last.” (The trend had already begun last year when licenses nearly doubled the number issued in 2016).
Add to all that the spin-off effects of Enbridge’s Line 3 pipeline replacement project coming to SW Manitoba soon. Hundreds of jobs have been promised and local businesses will get a temporary boost as workers flood into the area for as long as it takes to replace the aging pipeline that traverses the province from Kola to Gretna.
But if all you want is a simple sign that doesn’t require clairvoyance or an oil expert, head over to the Lions Campground in Virden and count all the Alberta license plates on the travel trailers.