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B.C.'s Hydrocarbon Resources

Northeast B.C. is part of a geologic area called the Western Canadian Sedimentary Basin, which extends from B.C. through to Saskatchewan. The site of a vast sea millions of years ago, this basin is rich in oil and gas deposits in sedimentary rock layers at depths from several hundred to several thousand metres below the surface. The B.C. portion of this basin contains mostly natural gas, with limited oil deposits.

Oil pools
Gas pools

Fig 1. Oil and Gas Pools of B.C., with the Montney basin outlined in yellow (move slider left or right to toggle between oil pools and gas pools).

Resources vs. Reserves

Resources are the total quantity of oil and natural gas estimated to be contained in subsurface accumulations (and includes quantities already extracted); however, much of the resource may never be recovered for various reasons, such as the ability to economically extract it, technological limitations and/or environmental regulations (e.g., the resource may be located within a park boundary where extraction is not permitted).

Product reserves, on the other hand, represent the quantity of resources that are currently commercially recoverable. Reserve estimates can vary over time based on new resource discoveries and depletion through ongoing extraction as well as other factors, such as current market pricing of products (which determine the commercial viability of production) and technological developments.

To be classified as reserves, the oil or gas must meet these criteria:

  • Penetrated by a wellbore.
  • Confirmation the well will produce (either a production test, or in production).
  • Meets regulatory requirements (production or development not prohibited by government policy or legislation).
  • Marketable to sell (viable transportation to sales point available either through pipelines, rail or trucking).
  • Developed within a reasonable time frame (up to five years for probable reserves).
  • Economic to recover, considering development and eventual reclamation costs, sales price, royalties, etc.

Note that the BCER's reserves estimates are classified as "2P probable reserves," which means there is a 50 per cent certainty that the stated amount (or more) can be economically recovered.

Reserves vs resources
Figure 2. Reserves vs Resources (not to scale). Current natural gas reserves in B.C., for example, are only about 3.5 per cent of the total estimated natural gas resources in the province.

B.C.’s Hydrocarbon Reserves

Oil and gas production in B.C. began in the mid-1950s. Early production typically involved the use of vertical wells to target “conventional resources,” relatively concentrated accumulations of oil and gas contained within highly porous formations that would flow readily once tapped.

Conventional oil or gas occurs as discrete "pools" within relatively porous subsurface zones trapped below impermeable rock (see Figure 3, below). Given the tendency of such resources to flow easily once tapped, historically “conventional” extraction methods involving vertical wells are sufficient to extract these resources. Conventional hydrocarbon pools tend to occur in a relatively dispersed and sporadic fashion due to the diverse geological conditions that can lead to such accumulations.

Figure 3. Conventional oil/gas pool (left) targeted with vertical drilling; unconventional oil/gas in dense rock (right) requires horizontal drilling and hydraulic fracturing to break the rock and release the oil or gas.

In contrast, unconventional (or “tight”) oil or gas is trapped in tiny spaces throughout layers of dense rock, such as shale or siltstone (see Figure 4, below) making vertical drilling inefficient for its extraction. Such resources require “unconventional” extraction methods to produce economically; that is, the use of horizontal drilling to penetrate across these lateral formations, followed by hydraulic fracturing, which breaks up the dense rock to allow bigger spaces through which the oil and gas can flow more easily (see video).

Figure 4. Shale, at left, and siltstone are relatively dense rock types that host much of the unconventional hydrocarbon reserves in northeast B.C.
Figure 4. Shale, at left, and siltstone are relatively dense rock types that host much of the unconventional hydrocarbon reserves in northeast B.C.
Natural Gas

The development of horizontal drilling, in conjunction with hydraulic fracturing, significantly boosted the province’s natural gas reserve potential. These advancements enabled companies to economically target the vast “unconventional” gas resources trapped within the dense rock horizons that characterize much of northeast B.C.’s geology. Since around 2005, production has predominantly focused on these unconventional gas resources, particularly within the Montney formation (see Figure 1, above), which currently holds over 90 per cent of the provinces remaining gas reserves. Gas reserve volumes have continued to increase as drilling at the outer boundaries of targeted fields incrementally reveals the full extent of their reserve potential, and these new “discoveries” outpace extraction (Figure 5, below).

Some natural gas deposits contain predominantly methane (chemical composition: CH4) and is called “lean gas” or “dry gas.” Often raw natural gas will also contain other by-product hydrocarbon molecules. Produced gas with significant amounts of heavier compounds is called “rich gas” or “wet gas” and these heavier hydrocarbons are called natural gas liquids (or "liquid hydrocarbons"). We distinguish between two types of natural gas liquids, which are separated from the raw natural gas at gas processing plants: (1) liquefied petroleum gases (ethane (C2​H6​), propane (C3​H8) and butane (C4​H10)) and (2) pentane+ (i.e., pentane (C5H12) and heavier hydrocarbons).

Oil

Oil reserves, in contrast to natural gas reserves, have trended somewhat downwards over the past 20+ years as extraction of this resource has exceeded new discoveries (Figure 5, below).

For a comprehensive summary of reserves and production data in the province, see our latest B.C. Oil and Gas Reserves and Production Report.

Figure 5. B.C.’s remaining hydrocarbon reserves volume by year and product category: (1) natural gas, (2) liquefied petroleum gases (LPGs) and pentanes+ and (3) oil. (Raw volumes under standard conditions).

Reserves Volume and Energy Content

As shown in Figure 5, natural gas is the most abundant hydrocarbon in the province by raw reserve volume. However, volume alone does not tell the whole story. As a gas under standard conditions, natural gas is significantly less dense—about 700 to 1,000 times less—than the other hydrocarbon types, which are liquid at standard conditions. Consequently, the energy content of a given volume of natural gas is much lower than that of the other hydrocarbons. Figure 6 illustrates this disparity, comparing (left) the raw volumes of hydrocarbon reserves under standard conditions and (right) the reserves standardized to the density of light oil, with energy contents expressed in barrels of oil equivalent (BOE).

BOE standardized density
Volume at standard conditions

Figure 6. B.C.’s Total Hydrocarbon Reserves by Volume and Energy Content, 2023.

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