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Natural Gas Facts

What is natural gas?

Natural gas is a naturally occurring hydrocarbon composed primarily of methane, though it may also contain varying amounts of natural gas liquids (ethane, propane, butane, and pentane) and non-energy components.

Key facts

  • Globally, Canada is the fourth largest producer and sixth largest exporter of natural gas
  • Canadian marketable resources of natural gas can sustain current production levels for up to 300 years
  • Canadian and U.S. natural gas markets are highly integrated, with 21% of Canadian consumption coming from the U.S.

Learn more about natural gas in Canada

Natural gas industry

The upstream gas industry is made up of several hundred companies that engage in activities such as exploration, drilling, and production of raw natural gas. Some upstream companies also own and operate gathering pipelines and field processing facilities.

The midstream natural gas industry operates natural gas processing plants, which remove impurities and natural gas liquids (NGL), natural gas storage facilities, gathering pipelines, and NGL facilities.

The downstream natural gas industry is made up of long haul transmission pipelines and distribution companies, also called local distribution companies (LDCs). LDCs receive gas from pipelines and then distribute it to consumers via extensive networks of local distribution pipelines.

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Conventional gas is produced from reservoirs using traditional drilling, pumping and compression techniques, whereas tight gas is found deeper below the surface in gas-rich shale rock formations and is typically produced using horizontal or directional drilling.

International context

Find out how Canada’s natural gas ranks on an international scale:

World production
World production – 433 Bcf/d (12 Bcm/d) (2019, preliminary)
Rank Country Percentage of Total
1 United States 23%
2 Russia 18%
3 Iran 6%
4 Canada 4%
5 Qatar 4%
World exports
World exports – 137.2 Bcf/d (4 Bcm/d) (2019, preliminary)
Rank Country Percentage of Total
1 Russia 21%
2 United States 10%
3 Qatar 10%
4 Norway 9%
5 Australia 8%
6 Canada 6%
World proved reserves
World proved reserves – 7,125 Tcf (202 Tcm) (beginning of 2019)
Rank Country Percentage of Total
1 Russia 24%
2 Iran 17%
3 Qatar 12%
4 United States 6%
5 Saudi Arabia 4%
17 Canada 1%
World shale oil resources
World shale oil resources – 7,577 Tcf (2015)
Rank Country Percentage of Total
1 China 15%
2 Argentina 11%
3 Algeria 9%
4 United States 8%
5 Canada 8%

Canada-U.S. resources

Proved reserves are when natural gas is known to exist and is recoverable under current technological and economic conditions. At the end of 2018, Canada and the U.S had a total of 512 trillion cubic feet (Tcf) of proved reserves of natural gas (Canada:73 Tcf, U.S.: 439 Tcf).

Marketable and technically recoverable resources

Canadian marketable resources refers to natural gas that is in a marketable condition, after the removal of impurities and after accounting for any volumes used to fuel surface facilities. Marketable resources are recoverable using existing technologies, based on geological information, but much of the drilling necessary to produce the natural gas has not yet been performed. 

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Canada’s natural gas reserves are estimated to be 1,383 trillion cubic feet, of which 542 trillion cubic feet is conventional gas, and the rest is unconventional including coal-bed methane, shale and tight gas. For comparison, the world’s reserves are estimated at 28,358 trillion cubic feet, with 15,044trillion cubic feet being conventional.

U.S. technically recoverable resources refers to natural gas that is estimated to be recoverable as drilling and infrastructure expands (similar to Canadian marketable resources).

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The United States reserves are estimated at 2,459 trillion cubic feet. 1,490 trillion cubic feet of which is tight and shale gas.

Canada-U.S. market

Canada’s natural gas market is heavily integrated with those of the U.S. largely due to the location of supply basins, demand centres, and the availability of transportation infrastructure, as well as existing Canada – U.S. trade agreements. These factors allow for consumers and distributors on either side of the border to freely access natural gas from the lowest cost supplier.

In 2019, Canada-U.S. production in the natural gas industry reached 108.8 billion cubic feet per day (Bcf/d) or 3.1 billion cubic metres per day (Bcm/d).

  • Canadian average marketable production: 16.6 Bcf/d (0.5 Bcm/d)
    • Conventional: 14%
    • Unconventional*: 86%
  • U.S. average marketable production: 92.2 Bcf/d (2.6 Bcm/d)
    • Conventional: 13%
    • Unconventional*: 87%
  • LNG imports of North American countries:
    • Canada: 0.05 Bcf/d
    • U.S.: 0.16 Bcf/d
    • Mexico: 0.66 Bcf/d
  • LNG exports of North American countries:
    • U.S.: 5.76 Bcf/d

* Unconventional gas includes tight gas, coalbed methane and shale gas

Natural gas wells

While Canadian natural gas production remained relatively flat and the number of wells drilled declined, the well productivity has increased over time. This reflects the increased use of horizontal drilling and increased well length.

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The number of annual completed natural gas wells in Western Canada dropped from over 12,326 in 2008 to 5,060 in 2009. From 2012 to 2019, completed gas well have been between 820 and 2,147 per year. The average amount of metres drilled has increased significantly from 1,318 in 2009 to 4,959 in 2019.

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Canada’s production of natural gas has been relatively stable from 2006 to 2019, whereas U.S. production has steadily increased. In 2019, Canadian production was 16.6 billion cubic feet per day while U.S. production was 92.2 billion cubic feet per day.

Marketable production by province

In 2019, Alberta produced 71% and British Columbia produced 27% of the marketable natural gas in Canada. Eastern provinces and territories produced a small amount of natural gas, amounting to less than 1% of total production.

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The total production of marketable natural gas in Canada in 2019 was 16.6 billion cubic feet per day. Alberta has the highest share of production at 71%, followed by British Columbia at 27%, and Saskatchewan at 2%


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Exports of natural gas have been slowly decreasing since 2007. 2018 saw a decrease to 7.8 billion cubic feet per day and 2019 a slight decrease again to 7.4. Imports rose from 2003 to 2012, peaking at 3.0 billion cubic feet per day in 2011 and 2012, but have since decreased to 1.9 billion cubic feet in 2015. Since then, imports are increasing slowly, now at 2.5 billion cubic feet in 2019.


While the share of exports is declining, more Canadian gas was exported than consumed domestically. In 2019, Canada exported 7.4 Bcf/d (0.20 Bcm/d) of natural gas.

Canadian natural gas exports to the Western U.S. and U.S. Midwest remain important.

Key facts

  • 45% of Canadian production is exported
  • All Canadian exports go to the U.S.
  • The value of Canadian net exports (exports minus imports) was $4.9 billion in 2019.


In 2019, Canada imported 2.5 Bcf/d (0.07 Bcm/d) of natural gas.

Natural gas imports from the U.S. into eastern Canada are on the rise, due to higher supplies in the U.S. Northeast and shorter transportation distances from these U.S. natural gas basins.

Key facts

  • 98% of U.S. imports and 9% of U.S. consumption come from Canada
  • 99% of Canada’s imports and 21% of Canadian consumption comes from the U.S.
  • Since 2009, Canada has also imported small amounts of liquefied natural gas from other countries through the Canaport LNG terminal in Saint John, N.B.

Upstream prices

The AECO hub is Canada’s largest natural gas trading hub and the AECO price serves as a benchmark for Alberta wholesale natural gas transactions.

AECO Price
Average 2008 – 2019 $3.39/MMbtu
Average 2016 $2.18/MMbtu
Average 2017 $2.20/MMbtu
Average: 2018 $1.54/MMbtu
Average: 2019 $1.80/MMbtu
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Monthly average natural gas spot prices for select hubs (Henry, Dawn, AECO-C) from 2007 to 2019 in Canadian dollars per million British thermal units.

Shale and tight gas

Shale is ultra-low permeability sedimentary rock containing natural gas. The gas is extracted by using horizontal drilling and hydraulic fracturing.

Hydraulic fracturing (or fracking) creates fractures in sedimentary rock formations by using pressurized water, mixed with small amounts of sand and additives, to release the natural gas.

Potential in Canada

Shale gas resources are found in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Nova Scotia and the territories.

Technological advancements in drilling (long-reach horizontal well bores) and completion techniques (multistage hydraulic fracturing) have enabled the commercial production of shale gas. These advancements have increased the long-term prospects for the supply of natural gas in North America.

Learn more about the exploration and production of shale and tight resources in Canada.


Natural gas is mainly transported within extensive networks of pipelines from natural gas wells to processing plants to Canadian customers and distribution companies. There are a variety of key existing pipelines that transport natural gas across the country.

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Map showing some of the major natural gas pipelines across Canada. Source: National Energy Board.

Enbridge Inc

Enbridge is a North American leader in gathering, transportation, processing, and storage of natural gas. Some of the pipelines that are a part of this network include:

  • Maritimes & Northeast Pipeline: Nova Scotia and New Brunswick to the U.S.
  • Union Gas: gas distribution and transmission in Ontario and eastern U.S.
  • West Coast Energy: a pipeline in British Columbia
  • Enbridge Gas Distribution: largest local gas distribution company in Canada
  • Alliance Line (50% owner): British Columbia through Alberta; and Saskatchewan to Chicago
  • Vector Line (60% owner): Chicago to Ontario

TransCanada Pipelines

TransCanada is a leading natural gas pipeline company serving markets in Canada, the U.S., and Mexico, tapping into virtually all natural gas basins in North America. Some of TransCanada’s key pipelines include:

  • Nova Gas Transmission Ltd (NGTL) System: serving Alberta and British Columbia
  • Canadian Mainline: several pipelines in the same corridor from the Alberta/Saskatchewan border to Quebec (city) with several interconnections to the U.S. along the way
  • Foothills: from Alberta to Idaho via British Columbia and from Alberta to Montana via Saskatchewan

ATCO Pipeline

  • Gathering and distribution lines within Alberta

TransGas Ltd.

  • Gathering, transmission and storage facilities in Saskatchewan
  • Owned by SaskEnergy Inc. (provincial distributer)

Natural gas energy use

The total natural gas energy use in Canada in 2017 was 2,742 petajoules (PJ). Natural gas has many different applications from heating to generating electricity to acting as an alternative fuel. It is used extensively in the residential, commercial, industrial, transportation and agricultural sectors.

Sector Energy use (petajoule) Energy use (bcf/d) % of total
Residential 659.2 1.63 24.0%
Commercial 531.3 1.32 19.4%
Industrial 1,508.2 3.74 55.0%
Transportation 4.6 0.01 0.2%
Agriculture 38.8 0.1 1.4%
Total 2,742.0 6.80 100%

Natural gas is primarily used by provinces for electricity generation and heating of space and water in buildings. Provinces with access to large amounts of hydro power electricity like Quebec tend to use less natural gas than others.

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In 2017, natural gas energy use was 2,742 petajoules. Alberta consumed the most natural gas at 42%, followed by Ontario at 30%, Quebec at 9%, British Columbia and Territories at 9%, Saskatchewan at 6%, Manitoba at 3%, and the Atlantic provinces at 1%

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