Steady Growth Anticipated in Canada’s Energy Sector for 2026

Canada's energy sector appears poised for stability in the upcoming year amidst an “evolving and volatile market,” as stated by analysts. The Canadian Association of Energy Contractors (CAOEC) predicts that 5,709 wells will be drilled by 2026, reflecting an approximately three percent rise from the current year.

The CAOEC also foresees comparable growth in drilling rig operating days and service rig hours. Mark Scholz, CAOEC's President and CEO, remarked, “We expect the market to show significant improvement in the latter half of 2026, which will likely bring growth in drilling and service operations.”

Premier Danielle Smith of Alberta emphasized the importance of Western Canada's contribution as global oil demand escalates. Estimates suggest a 25 percent surge in demand by the year 2050. “We want Alberta to secure a larger share of a expanding market,” she articulated during the CAOEC State of the Industry announcement.

This encouraging forecast follows a recent memorandum of understanding between Alberta's provincial and the federal governments. The agreement aims to foster action on a west coast pipeline and to rescind the federal oil and gas emissions cap. “For the first time, Canada has leadership that truly understands the significance of Alberta’s energy sector for revenue and overall quality of life,” Smith observed.

Scholz showcased a positive outlook on the long-term ramifications of this agreement, commenting that such collaboration would have seemed unlikely just a year ago. “This sets up a balanced approach, allowing Alberta and Western Canada better access to new markets while maintaining well-paying jobs for Canadians,” he noted.

In contrast, British Columbia Premier David Eby opposed lifting the coastal tanker ban, yet Smith urged him to keep an “open mind” as negotiations progress. Following the memorandum of understanding, Alberta and British Columbia must engage cooperatively to advance the initiative. The Alberta government is targeting July 1, 2026, to submit a proposal to the federal Major Projects Office.

Representing 89 companies nationwide, CAOEC's membership includes land drilling, offshore operations, and service rig operators. Meanwhile, another industry body, Enserva, recently provided its sector outlook, forecasting a 5.6% spending decline this year, along with an additional drop of 2.2% in 2026. Nevertheless, the overall forecast for drilling activity in Canada remains positive, particularly with robust growth expected in the latter half of the coming year.