Canadian Oil Projects
depicts the top 10 potential Canadian oil projects that may reach final investment decision (FID) between 2021 and 2025. For each project we show the Brent breakeven oil price calculated from FID date and payback time required to recover the funds invested. The size of the bubble represents the estimated oil resources held. Nearly all top projects are oil sands developments, the sole exception being Bay du Nord, a deep-water discovery off Newfoundland operated by Equinor. The breakeven oil price for Bay du Nord is estimated at slightly below US$50 per bbl, with around seven years needed to recover investments.
The largest oil sands project nearing approval is Syncrude’s Mildred Lake Extension, holding nearly 490 million barrels of reserves and expected to start producing by 2028. Its breakeven oil price is estimated at US$48 per bbl and it can take up to nine years to recover investments. Similar in size, the Foster Creek Phase H project is seen to have a lower breakeven oil price – US$38 per bbl – and take less time to recover funds. Therefore, the project is expected to reach approval already next year and start producing by 2024. The average resource weighted breakeven oil price for the top 10 Canadian oil projects shown is estimated at around US$46 per bbl and it should take around seven years to pay original investments back. Given our forecasted increase in the Brent oil price in the medium term, most of the projects highlighted should be commercial for approval and development over the coming years.
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