The Government of Saskatchewan is looking to provide long-term investment optimism for the province’s petroleum industry. Last week the province announced a new program that provides incentives to convert producing wells into waterflood injection wells and also for the drilling of new waterflood injection wells.

Waterflooding is an oil recovery strategy that allows for more efficient extraction of oil while also being sustainable and good for the environment. In a recent news release the government described waterflooding [as] a secondary recovery oil production technique that re-pressurizes an oil reservoir to boost total oil recovery from the reservoir. The Waterflood Development Program promotes good production practices and better reservoir management.

Bronwyn Eyre, Energy and Resource Minister, said that the cost associated with the conversion of a well to waterflood injection is approximately $500,000, which is where the Waterflood Development Program will offer support to companies, which would be repaid through a royalty program.

The government states, “At maximum uptake, the program will support $375 million in new investment over the next five years and 500 new permanent jobs. Over 10 years, the program will lead to an estimated $245 million in new provincial royalties. The program will also enhance the competitiveness of Saskatchewan’s energy industry by facilitating an economically sustainable increase of production capacity by an estimated 72 million barrels over the course of the next 35 years.”

Eyre said that the new program not only allows companies to do further work in our province, it enforces the commitment the province has to the oil and gas sector as a prominent and important part of our province, one that they are investing in and moving forward with despite hardships in other regions.

“Waterflooding is an important long term reservoir management strategy that improves oil recovery. Given the current challenges facing the Western Canadian oil industry, initiatives such as this will assist the sector over the next few years,” said Tristan Goodman, Energy Producers Association of Canada President.

In the wake of Alberta’s announcement curtailing oil production and coming off the heels of the First Ministers Meeting in Montreal last Friday, the nation continues to be divided on issues pertaining to the petroleum industry. Eyre stated that the Saskatchewan Government is moving forward, supporting the industries that provide jobs for residents and livelihood for the province.