Sustainability 2011 , 3 2096
3.11. Natural Gas Exploration and Development Expenditures
The CAPP expenditure statistics encompass both oil and gas expenditures, so some secondary
statistic is needed to estimate how the combined expenditures should be apportioned. The statistics do
separate the meters of exploration and development drilling that target oil vs. gas wells. For this study
it was assumed that the apportionment of expenditure dollars would be directly related to the meters of
drilling. This assumption is true only if the oil and gas wells have similar costs. As most oil and gas
are produced from the same basin, this was assumed to be a reasonable apportionment (as opposed to
if all the natural gas were on shore and the oil production was done much more expensively off shore).
The online version of the CAPP statistical handbook contains only the drilling distance statistics for
the current year. Copies of data from past handbooks must be requested directly from CAPP for the
years 1993 to 2010 [22]. Table 6 relates these hard to acquire numbers.
As an example, in 2002 the total meters drilled for oil was 0.71 e^6 + 4.65 e^6 = 5.36 e^6 meters and the
total meters drilled for natural gas was 2.63 e^6 + 6.02 e^6 = 8.65 e^6. Natural gas was thus 61.7% of total
drilling and so 61.7% of exploration and development expenditures would be apportioned to natural
gas wells for 2002.
Exactly like the combined oil and gas method, royalties and land expenditures were removed.
Table 6. Meters drilled for oil and gas in Western Canada by year (10 e^6 meters)Year
Exploratory Development
Oil Gas Oil Gas
1993 0.93 1.16 4.32 1.90
1994 1.04 2.22 4.09 3.12
1995 0.83 1.46 4.88 2.08
1996 0.97 1.29 6.34 2.57
1997 1.23 1.43 8.41 3.90
1998 0.87 2.14 3.10 3.18
1999 0.63 2.37 3.33 4.70
2000 0.79 3.19 6.06 5.92
2001 0.81 3.57 5.23 6.90
2002 0.71 2.63 4.65 6.02
2003 0.71 2.84 5.29 8.65
2004 0.79 3.96 4.91 10.84
2005 1.07 4.88 6.51 12.63
2006 1.66 4.28 6.81 11.17
2007 1.05 1.93 5.97 8.26
2008 1.44 1.41 6.05 7.84
2009 0.64 0.87 4.37 4.253.12. Natural Gas Overhead Expenditures
The oil and gas well lease and gas plant overhead expenditure statistics are also intermingled. To
apportion these amounts, it was assumed that expense is directly related to energy produced following
a NEB technique for estimating the cost per GJ of energy produced in Western Canada [9]. The
overhead expenditure amounts were split by percentage of gas-related energy production vs. oil-related