Challenges ahead for Canadian gas

By Abhishek Kumar 21 April 2017
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Shale gas operation in New England (Nexen) Shale gas operation in New England (Nexen)

Canada has high hopes for its gas reserves, especially those in the Western Canadian Sedimentary Basin (WCSB). However, the country’s struggle to market its gas at home and abroad is set to become tougher. Canada is taking steps to make its gas more attractive to customers, but the measures are not enough to beat the competition.

The advent of shale gas in the United States is proving to be the biggest challenge for Canadian production. The US remains a major market for Canada’s gas exports and accounted for almost 47% of its marketed gas output in 2016. However, growing gas production from US shale acreages has been gradually backing out Canadian gas on the market. Canada also has ambitious LNG export plans, but they will not materialise anytime soon as the global LNG market remains oversupplied thanks to growing exports from the likes of the US and Australia.

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