of Oil in Canada
fast paced world depends on it... and whether it’s filling your
car at the local gas station or transporting materials around the world,
most of our livelihoods depend on it. The industry is huge and today’s
technology, mind boggling. Times were much simpler in the
It all began in the
1850’s on a small parcel of land called Black Creek in southern
Ontario when two entrepreneurial brothers by the names of Charles and
Henry Tripp discovered a gooey black
In fact, their asphalt won honorable mention at the Universal Exhibition in Paris, France in 1855, prompting the city of Paris to import Canadian asphalt for the construction of the world’s first paved roads. Times were tough for the Tripp brothers in this isolated part of the world. They had a great product but no roads or rail lines to transport it.
Enter James Miller Williams, who was an entrepreneur himself in the carriage building business. Williams took over operation of the Tripp’s gumbeds and by accident or design, struck oil in 1858. This commercial well was the first one to produce oil in the world, one full year before the strike in Titusville, Pennsylvania. Williams also won medals for his products at an International Exhibition in Paris in 1862.
Oil Springs, Ontario was born and along with it 39 of Williams oil wells. Transportation to market was difficult with oil being hauled two barrels at a time, by horse and wagon, over 50 kilometers of swamp. Williams was the first person to refine oil, too and eventually moved his refining operation from Oil Springs to Hamilton to be closer to his customers.
Producers needed an inexpensive method to get their oil to the surface and John Henry Fairbank stepped up to invent the jerker line system…a method whereby a single engine could pump two or more wells at a time. Fairbank’s invention was a hit and he became Canada’s major oil producer of the 1800’s. In fact, his jerker line system remains in use today!
This was the first oil boom but prices for kerosene eventually fell from a peak of $1.25 a gallon - two day’s pay for most families - to 40 cents a gallon and below because of overproduction. Despite the glut of oil, business grew quickly however, with ever changing technologies pushing levels of production.
To this point gas and oil were used for lamps and for lubricating machinery. All that changed after 1898 when Canada’s first automobile was produced. This significant event marked the beginning of the world’s love affair with gas and oil and the search intensified to find Canadian sources. Drilling in Alberta first began with an exploration well near Waterton National Park and although the findings were small, it started a real push to find the “black gold”.
In 1909 the discovery of the “Old Glory” natural gas well near Bow Island led to Western Canada’s first pipeline three years later from Bow Island to Medicine Hat, Lethbridge and Calgary.
The Turner Valley area of southern Alberta was a host to three oil booms. The first occurred in 1914 when A.W. Dingman announced a major find. This caused a frenzy of activity with shares and new companies springing up overnight. The hype did not match the output, however and despite establishing the first commercial oilfield in Western Canada, Turner Valley’s first boom petered out. Before long, people’s minds were on other things…the outbreak of World War One.
In 1920, the flamboyant Ted Link journeyed up the McKenzie River to Fort Norman. Rumour had it that after extensive research, he simply pointed to a spot and told his crew to dig. Unfortunately full scale production at this site never materialized for another 65 years.
In 1924, after two years of drilling, Royalite #4 near Turner Valley came in. The blowout blazed for three weeks. Excess gas was pumped to “Hell’s Half Acre” with the resulting flares creating a red glowing sky seen from as far away as Calgary. This prompted another frenzy of share buying and Turner Valley’s second boom was on!
Residents could fill their cars up right from the well head and the Turner Valley “skunk gas” (so named for it’s lively odour) became well known around the province. Technology was about to take an upward turn as Rotary Drilling and Diamond Coring debuted in 1925. Nitro shooting was introduced in 1927. Further north, interest in the oil sands jumped, particularly with the invention of hot water extraction. The potential was astounding.
The 1930’s depression was next, causing many people in Canada to lose everything they had. The same went for Turner Valley as shares from the second boom became worthless. Despite the shortage of money though, drilling continued and in 1936 Turner Valley Royalties #1 became Canada’s first major oil field. It also happened to be the largest in the British Commonwealth. The entire area was flooded with men looking for work and small tar paper shacks were erected across the valley. With the depression being on, there was little other work available!
(Pause 2 secs for paper shack visuals)
Prolonged flaring in Turner Valley had permanently crippled gas flows, so the Alberta Petroleum and Natural Gas Conservation Board was created in 1938 to police production practices. In fact the measures taken in Turner Valley were a model followed worldwide.
World War Two approached and a number of significant events took place. Turner Valley’s oil field’s peaked while two large fires at the Abasand oil sands project to the north effectively shut down oil sands development for decades. Also, the threat of enemy attack through Alaska prompted increased activity in the north. The Canadian Oil Project, CANOL, was put in place to produce aviation fuel from Norman Wells, however the crude line to Whitehorse was abandoned, just after the war, for almost 40 years.
In 1943 the first exploratory offshore drilling took place just off the coast of Prince Edward Island. Though unsuccessful at the time, it would pave the way for many future offshore successes.
By most people’s
accounts in the oil industry, the singlemost important event of modern
times was the discovery of Leduc #1. After drilling hundreds of dry holes
throughout Alberta, patience was
Strangely, the Leduc find was treated as a local event until Atlantic Leduc #3 arrived.
(pause for fire footage)
The Atlantic #3 blowout was out of control for the entire summer of Oil was a metre deep in spots and finally caught fire, drawing media and investor interest from around the world. Activity skyrocketed.
Leduc was recognized as a significant producing oil field and the industry took off. This was the most prolific geological formation in Alberta and rigs dotted the landscape. “Black Gold” had finally been found in large quantities.
All of this production resulted in massive construction of pipelines across the west. In 1950 a pipeline link ran from Alberta to Central Canada and the U.S. Midwest. Three years later in 1953, the TransMountain pipeline was built linking Edmonton to Vancouver and Washington State. No east task, the building of pipelines 40 years ago required a little bit of determination and a lot of elbow grease.
(pause 3 secs for old pipeline construction footage)
Oil was now becoming a world economic player and led to the formulation of the National Energy Board in 1959 and the Organization of Petroleum Exporting Countries or OPEC, in 1960.
Investors finally, were once again ready to tackle the sticky subject of oil sands and the result was the establishment in 1964 of the Great Canadian Oil Sands Company, now Suncor Energy. This was the world’s first oil sands mining and upgrading operation, with full scale production beginning three years later. Shortly after, Syncrude was also established to share in the development of the vast oil sands of Northern Alberta.
The world’s thirst for oil was interrupted in the early 1970’s as OPEC quadrupled oil prices to $10.84 per barrel. Historic Leduc #1 finally stopped producing oil and PetroCanada was formed. The closing of the 1970’s saw a war between Iraq and Iran double the price of oil to $32 a barrel and create the infamous “oil crises”. The oil crises created a boom for Alberta but the National Energy Program came soon after and double digit inflation effectively ending the good times.
In the mid 80’s, Alberta bottomed out. Oil fell to $10 a barrel and the province lost 50,000 jobs.
Other Canadian projects were continuing to progress though, and exploration by Mobil and Chevron reaped rewards. Hibernia was discovered 350 kilometers out to sea off the coast of St. John’s, Newfoundland and new hope was held for residents of Atlantic Canada. The north also began to blossom as operations began at Peace River, Cold Lake and after many years, Norman Wells. The development of Heavy Oil was also planned for Lloydminster, Saskatchewan.
Another world event turned the tables for oil producers in the early 1990’s as the Gulf War resulted from Iraq’s invasion of Kuwait. Oil prices were driven to $40 a barrel and remained high until a year later when the United States bombed Iraq. This settled prices back down to $19.25 a barrel.
The rest of this decade saw the collective confidence of the oil industry grow to new heights and large scale projects of all kinds have surfaced in rapid succession. No more is this demonstrated than with the launch of Hibernia, a 70 story platform which is the newest star in Canada’s oil story. Encompassing 650 employees (350 of them offshore), Hibernia provides a very bright future for the east coast and once again places Canada as a world leader in oil production, exploration and research.
(pause for Hibernia visuals)
Just imagine, if you will, what the conversation would be like if the Tripp brothers, John Henry Fairbank or James Miller Williams were here, today. These pioneers might be in awe of the achievements that have taken place over the last 140 years.
(pause 2 secs)
From the serene birthplace of Oil Springs, Ontario, where oil is STILL produced, to the massive projects of the north and out to sea, we have a lot to be proud about.
Our Canadian oil and gas heritage is both a colorful and important one… and the people who sacrificed so much to develop it have laid the groundwork for millions of people to benefit.
Building the future
also means recognizing the past. It’s so important, then, to never
forget the heroes who made the Canadian Oil industry what it is today.
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