Canadian gas boom will boost Canadian economy and help Canada win back market share

The Canadian dollar has soared in recent weeks as a glut of Canadian natural gas and a stronger Canadian dollar help the country return to growth.

The price of natural gas in Canada has soared since mid-June, from about $US5.60 per million British thermal units (mmbtu) to more than $US8.40 per million mmbtu.

That’s a jump of more than 20 per cent.

But analysts at Canadian Natural Resources Ltd.

expect the market will continue to benefit from the glut of natural, low-cost gas.

The company said Thursday that Canadian natural producers will benefit from a strong Canadian dollar and a strong dollar-Canadian dollar exchange rate, as well as lower oil and natural gas costs in the region.

Canadian natural reserves are about one-third of the U.S. production of about 8.4 million bpd, so the demand for gas will likely remain strong even if the country’s economy slows.

But the Canadian energy sector will see its share of the market shrink, as more companies move to lower-cost countries to get the gas they need.

A new Canadian energy strategy will help Canadian producers and help them attract foreign investment, said Stephen Goss, senior vice-president of the company’s energy and climate initiatives.

The strategy is the result of the government’s new Energy Investment Plan, announced last month.

The plan will increase the amount of gas available for production by about 1.5 million bpct of production per year, which will help offset the cost of the cost-sharing for gas in the United States, said Goss.

“It is going to put a premium on Canadian gas in terms of market access, which in turn will help the U of C [Canadian university] and other Canadian universities to compete with the U States and other companies,” he said.

Goss said the strategy will also provide a boost to the industry by lowering the price of Canadian gas.

Canada’s Natural Resources Minister Peter Kent announced the plan last month to increase the number of wells that can be drilled in Canada.

It will allow for more natural gas to be produced in the province, said Kent.

The province has said it will use its energy resources to support its industries, but Kent said the government has also made the decision to boost investment in Canadian industries, such as energy infrastructure and the construction of roads.

Canadian Natural has already started drilling new wells in the Lower Sackville shale formation in northeastern Ontario, where it hopes to begin producing in 2021.

It expects to produce about 800,000 bpd of natural natural gas by 2023, with a target of 1.3 million bpm.

It also expects to increase production in Alberta by about 800 to 900 bpd per year.

The new strategy will have the effect of making Canadian natural resources more attractive to foreign companies that are looking to invest in the industry.

Gains in gas prices will also help boost the economy, said Jason Campbell, vice-chairman of energy research at Pembina Institute.

The country will continue its economic recovery, but at a slower pace, he said, adding that there will be a recovery in the Canadian oil sector and in the energy sector, as oil prices rebound.

“The Canadian economy is on track for growth,” Campbell said.

“In fact, the Canadian economy was a bit stronger in the second quarter of 2020 compared to the first quarter, when the gas market was strong.”

Campbell expects Canada to see its gross domestic product grow by 3.3 per cent this year and by 2.8 per cent next year.

But with the new strategy, Campbell said the country will be able to keep pace with the growth in demand for energy.

“While we will see some improvement in some sectors, the economy is going nowhere fast enough for the Canadian government to be able grow it,” he added.