Persistent and severe drought conditions across Western Canada could have a devastating effect on the oil and natural gas sector, which has drilling operations in some of the driest areas, according to a new report by Deloitte.
Limited water supply could have significant effects on the production of oil and gas, the report warns, and the timing couldn’t be worse for the industry as many companies are wanting to increase production and drilling with new export pipelines and facilities nearing completion.
The past several years have been parched in parts of Western Canada, but there is extra concern this year because of the below average snowpack in the mountains.
“It’s not going to be as simple to just pipe fresh water in. You may need to move it and truck it to different locations,” said Andrew Botterill, an energy analyst with Deloitte Canada, in an interview with CBC News.
In B.C., the provincial energy regulator has warned snowpack levels were only 72 per cent of the historical average.
Trucking in water and recycling water will both result in more “expensive and complicated” operations for companies, he said.
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Justin and Leanne Mills are struggling to pay their bills as work dries up in Alberta’s oilpatch
