Market Snapshot: Canada exports around half of the natural gas it produces

Release date: 2022-12-07

Canadian natural gas production exports have decreased, from around 60% of production in 2010 to around 50% in 2021.^Footnote 1 Since 2010, Canadian annual natural gas production increased from 151 billion cubic metres (Bcm) to 167 Bcm, while annual exports decreased from 92 Bcm to 80 Bcm^Footnote 2 (Figure 1). The two main reasons for the decrease in exports are:

1. increasing natural gas demand in western Canada, and
2. increasing production in the U.S., Canada’s only export market by pipelines.

Figure 1: Canadian natural gas production and exports

Canada is using more natural gas

Western Canada is consuming more gas than ever before. Mainly, this includes increased demand from Canada’s oil sands^Footnote 5 and increased use of natural gas to generate electricity.^Footnote 6 Given that production generally responds to economic drivers such as natural gas prices, this leaves less gas to be exported if, for example, prices limit production while annual domestic demand is increased.

U.S. natural gas production has increased, but still needs Canadian exports

Meanwhile, natural gas production increased in the U.S. from 604 billion cubic metres (Bcm) in 2010 to 978 Bcm^Footnote 7 in 2021.^Footnote 8 This was driven by growing gas production in the U.S. Appalachian Basin, which rose from 11 Bcm in 2010 to 326 Bcm^Footnote 9 in 2021.^Footnote 10 This means less Canadian gas is needed in the U.S. Midwest and eastern regions. So much gas is now produced in the Appalachian Basin that, per the CER’s Provincial and Territorial Energy Profiles, southern Ontario imports a significant amount of its gas^Footnote 11 from the U.S., which is often more economical than getting this gas from Western Canada Sedimentary Basin (WCSB)^Definition* producers. However, the U.S. west region still heavily relies on Canadian exports, which have increased over time and were 34 Bcm^Footnote 12 in 2021. Please see the Natural Gas Trade Summary for more statistics and charts on the amount and destination of Canadian exports and imports of natural gas.

Date modified:

2023-11-28