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 The conventional oil sector has been a perennial driver of the Alberta economy for more than 50 years and the powerful image of a drilling rig on the prairie is a critical part of Alberta's past, present and future. Developing the province's conventional oil resources has been a fixture of Alberta life since at least 1914, when the province's first major oil field was discovered at Turner Valley. Alberta was also responsible for a pivotal event in Canada's energy history in 1947, when the drilling of a successful well at Leduc, just south of Edmonton, transformed the nation from oil-poor to oil-rich, overnight.
Alberta's oil industry remains a key component of the provincial economy, accounting for thousands of jobs in exploration, production, transportation, refining, distribution and marketing. In the 2005/2006 fiscal year, conventional crude oil production was the third-largest source of non-renewable resource revenue for Albertans. Overall, it accounted for more than $3.7 billion in royalty payments to the provincial government in the past three fiscal years alone (2003/2004 to 2005/2006).
In 2005, conventional crude oil production made about 34 per cent of Alberta's total crude oil and equivalent production, which is about 23 per cent of Canada's total crude oil and equivalent production. This amounts to about 5 per cent of total North American crude oil and equivalent production.
The conventional oil sector has been a perennial driver of the Alberta economy for more than 50 years, and the Oil Development Business Unit has its sights set on ensuring that this valuable resource sees another 50 years of contribution to our province. The Conventional Oil Business Unit promotes and encourages exploration and development of reserves, calculates and collects royalties from producers and markets Crown's share of crude oil production through private sector marketing agents.
Development of Alberta's conventional oil industry has created an extensive infrastructure that facilitates the continued drive to locate, drill for and transport the oil to market. This infrastructure continues to grow: from 2000 to 2005, industry invested almost $100 billion in the province's conventional oil and gas industry.
Industry also continues to focus on finding innovative and more efficient ways to extract a higher percentage of crude oil from conventional reservoirs. The limitations of present day technology mean that only an estimated 26 per cent of available oil is currently recovered, leaving 74 per cent of the resource in the ground.
Most of the crude oil produced in Alberta is exported to other markets. The crude oil that remains in the province is refined into transportation fuels and other oil products to heat homes and buildings, generate electricity and manufacture lubricants, waxes, plastics, synthetic rubber and asphalt.
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