Montney a valuable asset: Petroleum co.’s not done with Canada yet
Although the most lucrative market for Western Canadian oil, natural gas and liquids remains the United States, petroleum companies with assets in northeastern British Columbia’s Montney Formation, continue to invest in the region through new projects, partnerships and expanding existing facilities and operations.
In their 2025 Q2 reports, ARC Resources, Enbridge, and Tourmaline affirmed their long-term commitments to the region, with plans to maintain and build upon their presence in northeastern BC, despite challenges presented by commodity price fluctuations and the regulatory environment.
Companies waiting on LNG Canada, increased demand
Low Canadian natural gas prices – which at present are well below the cost of supply – have led to temporary curtailments at some facilities, while companies bide their time until prices rebound.
“Currently, we have shut-in all dry gas production, approximately 360 million cubic feet per day (MMcfd) or 60,000 boe (barrels of oil equivalent) per day which will be fully restored when natural gas prices recover," Terry Anderson, ARC president and CEO said in a conference call to discuss the Q2 results.
Anderson expects that will occur later this year “as the ramp up in LNG Canada coincides with the conclusion of seasonal pipeline maintenance that is underway today.”
Tourmaline president and CEO Mike Rose said his company also found a need for curtailments in the first half of the year, noting that Tourmaline’s Q2 average production of just over 620,000 boe/day was achieved in spite of reductions related to wildfires in Alberta and “low commodity price periodic shut-ins in northeastern British Columbia and multiple frack activity deferrals into the second half of this year.”
The demand boost created by LNG Canada’s exports will reduce Western Canada’s current oversupply which has kept prices low, and analysts such as BMO Capital Markets estimate the demand surge could sustain higher prices for up to seven years. The production curtailments put in place by Tourmaline, ARC and others are intended to manage the oversupply.