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History of the oil and gas industry in Alberta

The first discovery of hydrocarbons in Western Canada was the discovery of natural gas in a water well. In 1883 the Canadian Pacific Railway (CPR) was seeking water for the transcontinental railway locomotives and it began to drill a water well at Alderson, AB and at a depth of 325 metres it struck natural gas (Gulless, 2019). The CPR used this gas for cooking and heating at the nearby railway section house at Langevin, AB (Peters, 2019). The discovery of natural gas encouraged further exploration and by the 1890’s, residents of nearby Medicine Hat were using the natural gas for cooking and heating (Peters, 2019).

By 1901 the first commercial gas field was developed at Medicine Hat and in 1909 the largest gas well in Canada, at that time, was drilled at Bow Island by the CPR and it was reportedly on the wrong location. The name of the well was “Old Glory” (Russum, 2004). By 1912 Canadian Western Natural Gas built a gas pipeline from Bow Island to Calgary (Russum, 2004).

The First Oil Well in Western Canada was drilled in 1902 in what is now the Waterton Lakes National Park. It was drilled by John Lineham, whose Rocky Mountain Development Company had a mineral claim on the land along Oil Creek where there were natural oil seeps. The Lineham Discovery Well #1 struck oil at 311 metres (1,020 ft), producing saleable quantities of oil at the rate of 300 barrels per day. However, the well casing quickly failed, and the borehole became jammed with debris and drilling tools. It was cleared in 1904, and a pump was installed but the drill tools jammed the well again and the well was abandoned (Wikipedia, 2019a).
In 1914, there was the first discovery of gas-condensate reservoir at Turner Valley called Dingman #1 which came from the Cretaceous (Russum, 2004). It all began when Stewart Herron, who was an area farmer and amateur geologist, saw gas bubbling up near the Sheep Creek and sent samples to the universities of Pennsylvania and California. Herron then went ahead and bought up property in the area and attracted several investors, including R.B. Bennett (later was a Canadian prime minister), Senator James Lougheed (Peter Lougheed’s grandfather), A. E. Cross (one of the four founders of the Calgary Stampede and established the Calgary Brewing and Malting Company in Inglewood) and driller Archibald Dingman, and Calgary Petroleum Products was formed (Bentein, 2017).

In 1921, Calgary Petroleum Products was purchased by Imperial Oil and reorganized as the Royalite Oil Company. Royalite drilled its first well and made its first major discovery in 1924 when Royalite No. 4 struck gas, thereby gaining control of the wells in Turner Valley.

The Royalite No. 4 well was the first sour gas well in Alberta. Hydrogen sulfide is easily identified by its rotten egg smell, and it is unstable, corrosive and explosive. The hydrogen sulfide must be removed from the gas, in a process called sweetening which involves high pressure. This was adopted from the methodology used in the Tilbury field in southern Ontario and a similar scrubbing operation at Turner Valley was created to remove the hydrogen sulfide (Alberta culture and tourism, 2019a).

In 1920, Imperial Oil at Norman Wells discovered a light oil-bearing formation due to oil seeps in the area. Norman Wells became important in the Second World War as a source for oil for the military in Alaska and Yukon (Wikipedia, 2019b). In 2016, the daily production was 8969 bbl/day (Statista, 2019a) and had a total accumulated production of 272 MMbbl (Statista, 2019b).

In 1938, Alberta Petroleum and Natural Gas Conservation Board which was formed by the Social Credit Government significantly reduced flaring of natural gas as a by-product of oil production (Russum, 2004).

In 1946, Imperial Oil acquired a major seismic survey across central Alberta and the results suggested a large, potentially oil-bearing geological anomaly like the Devonian formation previously found around Norman Wells, Northwest Territories (Alberta culture and tourism, 2019b).

The Leduc exploratory well was to be Imperial Oil’s last attempt to find oil in Alberta because there had been no major oil discoveries in the previous twenty-five years, and Imperial Oil had spent millions of dollars drilling 133 consecutive dry wells (Wikipedia, 2019c). In 1947, Imperial reluctantly drilled Leduc No. 1 into the Nisku formation and with the success of this well it resulted in numerous major discoveries across the prairies (Wikipedia, 2019c). As of 2016, the Leduc Field had a total production of 400 MMbbl (Statista, 2019b).

Though Leduc No. 1 received a lot of the hype, Imperial struck oil again after the Leduc No. 1 at Redwater but Redwater was much bigger. The first estimates of Redwater's reserves were 824 million barrels which was more than double the reserves at the Leduc field. At its peak in the mid-1970s, Redwater was producing 150,000 barrels of crude a day, which rivals the current output of Imperial's Cold Lake oil sands megaproject (Brethour, 2018).

In 1953, Seaboard Oil (Texaco) and the Socony-Vacuum Exploration Company (Mobil Oil) discovered the Pembina oilfield which became Alberta’s largest oilfield in estimated reserves and actual production. It was discovered about 113 km southwest of Edmonton with the center of the field being Drayton Valley. It was the largest stratigraphic oil trap in Western Canada and the primary producing formation was the Cardium. Additional production came from other deeper pools such as the Viking Formation; and the sandstone beds of the Fernie such as the Rock Creek Member (Nielsen and Porter, 1984; Wikipedia, 2019d).

With rejuvenation after companies started to do horizontal wells and frack the sands, the Pembina field still produced in 2016 at a rate of 222753 bbl/day making it the largest daily oil producing oil field in Canada with Hibernia being second at 135998 bbl/day (Statista, 2019a).

In 1957, there were some discoveries in the Beaverhill Lake zone of the Devonian reef formations which became known collectively as the Swan Hills field. Swan Hills field composed a large area containing an estimated 926 million barrels of crude. We then realized the Devonian reef complex was much more extensive than originally believed, and companies began to explore extensively in the northern parts of the province (Alberta culture and tourism, 2019b). In 2016, the daily production was 11831 bbl/day (Statista, 2019a) and had an accumulated production of 924 MMbbl (Statista, 2019b).

In 1964, Chevron discovered the Mitsue oil field in North Central Alberta which produces large quantities of oil and minor gas from the Middle Devonian Gilwood Sandstone. The latter is generally clean, well sorted, fine to medium grained and quartzose, with an average oil column thickness at the field of 4 m and porosity averaging 15-20 % (Christie, 1971). In 2016, the field had an accumulated production of 402 MMbbl (Statista, 2019b).

In 1965, West Rainbow was discovered by the Banff-Aquitaine Oil Company. There are several biohermal reefs of Middle Devonian age which are characterized by either a pinnacle or an atoll form and develop to a maximum height of 800 ft (Langton, and Chin, 1968). 3D seismic imaging became important when there was rejuvenation in the area in the 1980’s, with companies shooting small 3D’s and picking horizons by hand on all the sections before companies acquired interpretation software such as Landmark Graphics. In 2016, the daily production was 7855 bbl/day (Statista, 2019a).

The commercial production of oil from the Athabasca oil sands began in 1967, with the opening of the Great Canadian Oil Sands (GCOS) plant in Fort McMurray. It was owned and operated by the American parent company, Sun Oil Company.

In 1979, Sun formed Suncor by merging its Canadian refining and retailing interests with Great Canadian Oil Sands and its conventional oil and gas interests. In 1995, Sun Oil also divested its interest in the company and Suncor became an independent, widely held public company (Wikipedia, 2019e). In 2009, Suncor acquired Petro-Canada.

In 2017, the production of bitumen was 2.8 MMbbl/day using two main methods: drilling (in situ or steam-assisted gravity drainage - SAGD) and mining. The method that is used depends on how deep the reserves are deposited, with about 20% of the oil sands reserves being located close enough to the surface to be mined.

In 1976, Canadian Hunter discovered Elmworth, and John Masters and Jim Gray created the concept of the Deep Basin Gas which explains Basin Center Gas Accumulations like the Eagle Ford, and the Permian (Russum, 2004). In 2001, Burlington Resources Inc. of Houston purchased Canadian Hunter for $3.3 billion and in 2006 Burlington was acquired by ConocoPhillips in a deal worth about US$35.6 billion.

As of 2016, if we look at light oil production and the top 5 oil fields in Canada we have (Statista, 2019b):

1. Pembina - 2039 MMbbl
2. Hibernia - 1001 MMbbl
3. Swan Hills - 924 MMbbl
4. Redwater - 889 MMbbl
5. Rainbow - 718 MMbbl.

Oil and gas have shaped the prairies and we have seen small companies like Canadian Hunter taking a new idea and developing it, becoming a multi-billion-dollar company. We see that spirit still alive especially now with the advent of horizontal drilling and the move towards resource plays such as the Montney, Wilrich and Duvernay in companies like ARC, Peyto, Tourmaline, Painted Pony, etc. Canadian expertise has also been exported to other areas around the globe.

It is the community that we have built that fosters innovation and development. Magazines like the CSEG Recorder allow us to share that technology as well as the:

• CSEG technical luncheons
• CSEG Doodletrain
• Geoconvention
• CSEG Symposium
• SPE Annual Technical Conference and Exhibition (ATCE)
• Canadian Society of Petroleum Geologists (CSPG) technical luncheons
• As well as the Canadian Well Logging Society (CWLS) and Canadian Society for Unconventional Resources (CSUR) technical luncheons

Growing up on the prairie

Aboriginals

The prairies are home to the First Nations with the Treaty Number 6 being signed by three First Nations in Saskatchewan: Cree, Assiniboine and Ojibwa, and the Treaty Number 7 being signed by five First Nations in Alberta: the Siksika (Blackfoot), Kainai (Blood), Piikani (Peigan), Stoney-Nakoda, and Tsuut’ina (Sarcee). Some of the streets of major cities are named after notable First Nation Chiefs and First Nations, such as Sarcee Trail in Calgary.

Many names of towns in the prairies have roots to First Nations such as Okotoks (Blackfoot “Big Rock”), Ponoka (Blackfoot “Black Elk”), Winnipeg (Cree “muddy water”), or Saskatoon (Cree for the Saskatoon berry) to name a few.

There are some special places for the First Nations such as Writing-on-Stone, Big Rock (Okotoks), Head-Smashed-In Buffalo Jump just to name a few.
Some notable First Nations Chief:

1. Isapo-Muxika (Crowfoot) who is well known for his involvement in Treaty Number 7 and did much negotiating for his people. Crowfoot chose to remove himself and his people from the fighting that took place during the North-West Rebellion for as long as possible but his adopted son Pitikwahanapiwiyin (Poundmaker) was involved (The Canadian Encyclopedia, 2019a).
2. Pitikwahanapiwiyin (Poundmaker) was the adopted son of Chief Crowfoot. Pitikwahanapiwiyin strove to protect the interests of his people during the negotiation of Treaty 6 and reluctantly signed Treaty 6. He was a peacemaker and did not take up arms in the North-West Rebellion, but a young and militant faction of his band did participate in the conflict, which resulted in Pitikwahanapiwiyin’s arrest and imprisonment for treason (The Canadian Encyclopedia, 2019b).
3. Jerry Potts (Ky-yo-kosi, which means Bear Child) was famous among the Blackfoot as a great warrior and well known as a guide for the North-West Mounted Police (NWMP). He led the police to the notorious whisky post Fort Whoop-up and directed them to an island in the Oldman River where they constructed Fort Macleod. Potts educated each group about the other and ensured friendly relations (The Canadian Encyclopedia, 2019c).

Lewis and Clark visited the southern prairies

Some of the first explorers to the prairies was Lewis and Clark, who followed the Missouri River drainage basin, which was bought from the French in the Louisiana Purchase. Lewis and Clark came to Southern Alberta around May 1805. The Milk River is part of the Missouri drainage basin and was technically part of the Louisiana Purchase. The Milk River was named by Lewis and Clark for its whiteness.

North-West Mounted Police

As settlers came to the prairies it was recognized a police force was needed to bring law and order to the prairies and to deal with the whiskey trading that was demoralizing the First Nations. The NWMP also were sent out to help enforce laws that were put into place by the government. In August 1873, the first 150 recruits of the NWMP went to Lower Fort Garry (Winnipeg) where they trained along the lines of a cavalry regiment, then on July 8, 1874, 300 officers and men of the NWMP set out from Dufferin, Manitoba, on a grueling, two-month, 1,300-kilometre march across untracked prairie (The Canadian Encyclopedia, 2019d).

When the NWMP arrived, they ended the whiskey trade on the southern prairies and the violence that came with it, helped suppress the North-West Rebellion, and brought order to the Klondike Gold Rush. The NWMP pioneered the enforcement of federal law in the West and the Arctic, from 1873 until 1920 (The Canadian Encyclopedia, 2019d).
Some notable members of the North-West Mounted Police who tamed the Canadian prairies were:

1. Inspector James Walsh who established Fort Walsh in Cypress Hills to stop the whiskey trade and met with Sitting Bull when he and his Sioux warriors crossed over the Canadian border after defeating General Custer at the Battle of Little Big Horn. They settled near the Wood Mountain post in present-day Saskatchewan (Wikipedia, 2019e).
2. Superintendent James MacLeod who founded Fort MacLeod, suppressed the whisky traffic and, having won the confidence of the Blackfoot chiefs, negotiated Treaty 7 (The Canadian Encyclopedia, 2019f).
3. Sir Sam Steele who was an important participant in the signing of Treaty 6 and Treaty 7, helped with the construction of the Canadian Pacific Railway, fought in the North-West Rebellion and during the Klondike gold rush organized customs posts on the Chilkoot and White passes enforcing regulations requiring incoming miners to bring adequate food supplies to prevent starvation (The Canadian Encyclopedia, 2019g).

Unrest in the prairies

In 1869 the Hudson's Bay Company (HBC) transferred the territory comprising the Hudson Bay drainage basin to the to the new Dominion of Canada. With this transfer the Métis feared for their culture and land rights under Canadian control and formed a provisional government to negotiate the terms for entering Confederation with Louis Riel the head of that government. Louis Riel negotiated the terms Manitoba entered the Canadian Confederation. During these negotiation Riels’ government had captured Fort Garry and held some of the men at Fort Garry as hostages, including Thomas Scott. Unfortunately, Riel on March 4, 1870, ordered the execution of Thomas Scott for being a racist. Riel then fled to the United States to escape prosecution for Scott’s execution (Wikipedia, 2019g).

In 1884 the Métis leaders in Saskatchewan called on Riel, because of what he had done for Manitoba, to articulate their grievances to the Canadian government (Wikipedia, 2019g). Unfortunately, Riel came to Saskatchewan and organized a military resistance with Gabriel Dumont. On April 2, 1885 hostilities came to a head and 9 white males were massacred in the small community of Frog Lake, Saskatchewan which started the North-West Rebellion. The rebellion would end about a month later May 12, 1885 at the Battle of Batoche (The Canadian Encyclopedia, 2019h).

If you are from Calgary, you know about the Steele Scouts (named after their commander Sam Steele) who were volunteers that were part of the Alberta Field Force that fought the rebels during the North-West Rebellion.

Immigration to the Prairies

When you think about prairie towns of old there are four things that come to mind:

1. Chinese restaurants
2. Grain elevators
3. Volunteer firefighting
4. Mounties

Chinese restaurants

It seemed every town had a Chinese restaurant but it being a Chinese restaurant just meant the owner’s ethnicity was Chinese, it wasn’t the type of food that was served there. Eventually these restaurants served half western food and half Chinese. It was recognized that the owners of these Chinese restaurants worked hard; the restaurant was a gathering place for the community; and the town was very proud of their Chinese restaurant.

Grain Elevators

Just about every town also had grain elevators. As you drive by towns you still see the grain elevators. It truly is a symbol of a prairie town and the grain elevator was another place people gathered. Most of the grain elevators have the same shape being square ones, like a tall house with a smaller peaked-roof house on top and were called “cribbed” construction elevators (Windsor, 2012). This was the construction standard set by the CPR as a condition of grain merchants obtaining a licence to build an elevator along the CPR tracks (Windsor, 2012).

Recently for some towns the symbol has become the pumpjack or horsehead showing the impact of oil.

Volunteer firefighting

The other symbol of the prairie is volunteering firefighting. 80% of the firefighters in Alberta are volunteers, 97% of the fire departments are run by volunteers and there are 450 volunteer firefighting departments in Alberta.

The RCMP

The last symbol of the prairies is the RCMP or the Mounties. The RCMP provides contract police services to small towns and communities across Canada. Just about any sizeable town in the prairies has a Mountie detachment. The detachments tend to be small, but they have established strong relationships to the community, which is required because they maintain the peace and order over an area of 100’s of square kilometers of sparsely populated areas where their radios and cellphones may not work properly (CTV News, 2017). The RCMP rely heavily on the community to help them to do their jobs. Canada has one of the lowest rates of police per capita among industrialized countries - about 188 officers for every 100,000 Canadians (Tunney, 2018).

Why immigrants came to the prairies

The people who came here to the prairies were attracted by offers of free land, 160 acres each. The prairies were looking for farmers to settle here particularly from Eastern Europe.

Eastern Europeans in the prairies

Most people in the prairies are familiar to Ukraine food like perogies, cabbage rolls, and kielbasa sausage. Perogies is the top iconic food in Alberta (Wilson, 2017) which reflects the influence of Eastern European immigrants into Western Canada.

American immigrants to the prairies

Many from the U.S., especially from Midwestern states like Minnesota, immigrated here because the supply of free homesteads in the States were exhausted and many immigrants to the States encountered high land costs and overdevelopment in the American West. Those that came here from the States were not considered as Americans but were seen by the Canadian government as coming from the nation their family had originally emigrated from, i.e. someone born in Minnesota, but their family came from Germany was considered German.

There would later be a second wave of American immigration when oil was discovered, and they came from Texas and Oklahoma. The influx of Americans especially from Texas and Oklahoma brought individualism (a perspective that sees a government’s duty to maintain a stable society but with minimum intervention in the lives of the people) to the prairies which makes the prairies different in political ideologies then the rest of Canada.

Albertans have also shown an affinity for American political ideas, movements, and policies (Wiseman, 2010) and this is reflected in Alberta being the only province that held Senate “elections” in 1989, 1998, 2004 and 2012 (Climenhaga, 2019). This is because Albertans have been pushing for a Triple E Senate where it is: equal in representation by province, elected, and effective like the US senate.

Scottish Influence

If you ever been to Aberdeen, Scotland you will notice a road sign outside of town stating how far away Banff is, which really surprised me, and it is about 45 miles away. It is said that Banff, Alberta was named after the birthplace (Banffshire, Scotland) of the president of the CPR George Steven. Even Fort Calgary was named by Col. MacLeod after Calgary Bay on the Isle of Mull, Scotland.

Calgary is currently home to the Calgary Highlanders and the King's Own Calgary Regiment whose headquarters is Mewata Armoury. Inside the Calgary Highlanders is the Regimental Pipes and Drums of The Calgary Highlanders that have performed in the Calgary Stampede parades.

Calgary also has ties to the Princess Patricia's Canadian Light Infantry (Princess Pats) and the Lord Strathcona's Horse (Royal Canadians) who were based out of Currie Barracks from 1946 to 1997 when both units were moved to Edmonton. 

Dynasties of the Alberta government

The American influence may be why other Canadians tend to see people from Alberta being conservative and a bit to the right, plus Alberta has a history of keeping the same political party in office for a long time. If we look at the length of time a political party held office here in Alberta, it is almost as if they had established dynasties:

Liberals - 1905 to 1921.
United Farmers - 1921 to 1935.
Social Credit - 1935 to 1971.
Progressive Conservatives - 1971 to 2015.

It also did not help having two of the Premiers of Alberta and members of the Social Credit party - William Aberhart and Ernest Manning - evangelizing on radio broadcasts that were heard across Canada. 

Who we are

Who we are has been defined by our history and the environment around us which at times can be inhospitable weather and environmental conditions such as severe, brutally cold winter storms, droughts, unbearable hot summers, tornadoes, extreme thunderstorms, etc. The landscape of the prairies can also be daunting with badlands, river valleys, grasslands, the foothills and the Rockies to the west. Many utilize the prairies to film movies because how dramatic our landscape can change in short distances. 

It seems all of us are somehow connected to nature, and part of this is because most are slightly removed from farming. We are also awed by the spectacular landscape around us that shows the awesome power of nature such as the McConnell Thrust Fault in the front ranges where Devonian rock is over top Cretaceous.

Captain John Palliser once described the prairies as an area “…ill-suited for civilization, a region of short grasses and shrubs and desert-like conditions where cacti grew along the coulee ridge.” 

We are a community of immigrants and that gives us a diverse, international flavour which is reflected in the different restaurants and food we eat, the diversity in religions for example “Little Mosque on the Prairie”, and the tolerance we have to other cultures. Learning and accepting different traditions is reflected in the festivals we have throughout the summer such as Carifest; Arab Fest; Fiesta Filipino; Francophone Fest; Fiestaval Latin Festival; etc. We are a cultural mosaic where people still embrace their culture and heritage.

We are entrepreneurs, innovators, pioneers, willing to adopt to changes and it seems to be in our DNA coming from our forefathers who dared to come to and settle in a new country.

We have become leaders in developing of oil and gas in different settings such as the oilsands and the deep basin where we find most of the resource or unconventional plays. Our expertise and knowledge are valuable globally especially as other countries such as China explore for unconventional plays. We are known for our openness and our ability to adapt which makes it easier for us to move and live in other countries.

Examples of individuals who have raised the bar in the oil industry not only here in Canada but around the world are: Roy Lindseth, Dave Robson, John Boyd, Brian Russell, Dan Hampson, John Masters, Jim Gray, Jack Gallagher, (Norman) Murray Edwards, Larry Lines, Don Lawton, Satinder Chopra to name just a few.