Oil production in Fiscal Year 2009 (Apr 09 – Mar 10) is on track to fall below even the low-ball estimates used in the spring provincial budget.
The provincial government estimated oil production in 2009 would be 98 million barrels. That’s 21% below 2008, based on the production for Calendar Year 2008 (Jan to Dec) of 125.3 million barrels.*
Actual production in the first half of the fiscal year was 44.5 million barrels (mbbls), according to figures available from the Canada-Newfoundland and Labrador Offshore Petroleum Board. Average monthly production has been 7.42 mbbls.
By comparison, in the first six months of FY 2008, production was 62.5 mbbls with a monthly average of 10.41 mbbls.
Oil production from the three fields offshore was down 41% in August 2009 compared to August 2008. There was also 39% less oil pumped in May 2009 and 34% less in September 2009 on a year over year comparison.
Total oil production in FY 2008 was 123.4 mbbls. That means that production in the second half of 2008 was actually below production in the first half of the year.
While it isn’t inconceivable that production will ramp up between September and March, it seems unlikely to hit the 2008 average production level of 10.41 mbbls per month.
That’s about what would be needed to generate any significant oil revenues above the budget projections, and using current prices.
| FY 2008 | FY 2009 | % +/- | |
| Apr | 10, 616, 444 | 9, 116, 213 | -14 |
| May | 11, 403, 549 | 6, 915, 304 | -39 |
| Jun | 8, 978, 865 | 7, 374, 739 | -18 |
| Jul | 11, 288, 144 | 8, 629, 918 | -24 |
| Aug | 11, 085, 392 | 6, 537, 149 | -41 |
| Sep | 9, 400, 105 | 6, 164, 639 | -34 |
| Cumul 6 mo | 62.5 mbbls | 44.5 mbbls | -28.8 |
| Avg per mo | 10.41 mbbls | 7.42 mbbls | -28.7 |
-srbp-
* 21% of the actual fiscal year production would be 97 million barrels.