Preparing for the Final Boom by Richard Schneider
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Since the advent of big oil, boom and bust cycles have been a fact of life in Alberta. Consequently, Albertans face the current economic crisis with a quiet resolve born of the knowledge that, soon enough, another boom will be on its way and all will be well again. Indeed, there is evidence to suggest that the seeds of the next boom have already been sown.
But what if the next boom turns out to be the last one. One last big hurrah, and that’s it. There are some fairly compelling reasons why this might be so. It is not that Alberta is about to run out of oil any time soon. But as the saying goes, the stone age did not end because they ran out of rocks. A global energy transition has begun and in 20 years the production and use of oil will be much different than it is today. For Alberta it means that the era of oil booms will draw to a close and it would be well for us to begin thinking now, while options still exist, about how best to manage the final boom to ensure that our prosperity does not end when it does.
Let’s begin by taking stock of what we know.  As everyone is keenly aware, Alberta sits atop the second-largest deposit of oil in the world, some 1.7 trillion barrels in-place. Our golden goose has enough eggs left to keep laying for at least a hundred years. But there is an important caveat here. Production of conventional oil — the oil we built our fortune on — peaked in the 1970s and has been in decline ever since. Production of conventional oil is declining in most other oil producing regions as well, aside from the Middle East. The difference in Alberta is that we have vast supplies of unconventional oil, the oilsands, to take up the slack. Within the next five years oilsands production is expected to account for 65% of Canada’s total output of crude oil.
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