It’s not all about the US – opportunities in the Canadian gas markets

Despite near-term infrastructure challenges, the Canadian market is poised for growth. Producers continue to improve upstream economics, supported by a relatively stable cost environment and higher value liquids-rich plays. Gas breakevens continue to fall, and demand drivers look a lot more promising than six months ago. LNG exports, including LNG Canada, continue to gain momentum, stronger oil prices encourage additional oil sands expansion projects, and coal-to-gas switching is well underway. US export markets, especially the Midwest and West, will see additional Canadian volumes because of the improved WCSB upstream economics. And despite the basin's lack of additional takeaway capacity in the near term, 2 bcfd of pipeline projects could come online in 2020-2022 to support piped exports.