June 5, 2008 / 8:27 PM / 11 years ago

Oil sands output to nearly triple by 2017 - report

CALGARY, Alberta, June 5 (Reuters) - Production from Alberta’s oil sands climbed to an average 1.32 million barrels a day last year, a 5 percent rise over 2006 and could get to 3.2 million per day by 2017, the province’s energy regulator said on Thursday.

In its annual reserves and supply-demand report, Alberta’s Energy Resources Conservation Board said the province’s output of tar-like bitumen rose to a total 482 million barrels in 2007 and could rise above one billion barrels within nine years.

Production from Canada’s oil sands region, boasting the largest oil reserves outside of the Middle East, is ramping up to meet demand from U.S. refiners, with more than C$100 billion ($98 billion) in projects under construction or on the drawing board.

The board’s report said that the total amount of bitumen — a tar-like form of heavy oil that needs upgrading to be useful — in the province is 1.7 trillion barrels. However only 173.2 billion barrels of that total can be economically produced, an estimated 500 million barrels below the board’s 2006 reserves tally because of production.

The province’s conventional oil output, on the decline for years as large fields age and big new discoveries become increasingly rare, fell 3.5 percent last year to 524,800 barrels a day.

Alberta producers replaced only 68 percent of their conventional oil production with new discoveries last year, pushing reserves down 3.5 percent from 2006 to 1.5 billion barrels.

In 2007, the province’s combined output of bitumen, conventional oil and natural gas liquids rose 3 percent to 1.9 million barrels per day, the regulator said.

Natural gas production dropped slightly to a total 4.7 trillion cubic feet from reserves of 38 trillion cubic feet.

Alberta also has 37 billion tonnes of coal, according to the board. ($1=$1.02 Canadian) (Reporting by Scott Haggett; editing by Rob Wilson)

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