Oilpatch drilling has slowed due to falling oil and natural gas prices.
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Low oil and natural gas prices are weighing heavily on the industry as drilling activity in Western Canada is falling and further declines are expected in 2026.
North American oil prices remain below US$60 a barrel after climbing to more than $80 in January.
As a result, oil and gas companies are cutting costs, and total capital spending is expected to decline 5.6 per cent this year and 2.2 per cent in 2026, according to a state of the industry report released Wednesday by Calgary-based Enserva, which represents oilpatch service companies.
The total number of wells drilled in 2025 is expected to be nine per cent less than in 2024, including a 16 per cent decline in British Columbia.
In Alberta, drilling activity is expected to decline by seven per cent this year, while a 10 per cent decline is expected in Saskatchewan. Drilling in both provinces is projected to decline by an additional four percent in 2026.
The Enserva report paints a gloomy picture for the oilpatch for many years to come as it highlights how the three major forecasting agencies (Sproul, GLJ and McDaniel) do not expect oil prices to improve before 2029 relative to prices in 2024.
According to the Enserva report, oil and gas services companies began cutting jobs in the spring of this year and “will continue through the end of 2025, plateauing through 2026.”
