Canada's Oil Sands Are Running Out of Road

Enverus projects 1 MMbbl/d of Canadian oil sands growth, but warns pipeline egress will run dry by the early 2030s

11 May 2026

Canada's oil sands are set for substantial growth, but infrastructure to carry that oil to market may not keep pace. Enverus Intelligence Research, in a report published in April 2026, projected that output from the Western Canada Sedimentary Basin could rise by roughly one million barrels per day over the next seven years, driven largely by expansions of existing Steam-Assisted Gravity Drainage, or SAGD, operations.

On paper, the economics are compelling. With more than 200 billion barrels of recoverable oil and half-cycle breakeven costs below $50 per barrel, few basins anywhere can match its cost structure.

Brownfield SAGD projects, which expand existing facilities rather than build new ones, can run profitably well below current market prices. Against faster-depleting shale plays elsewhere in North America, that gives Canada a durable structural advantage.

"The longest runway of any North American oil play" – Dane Gregoris, Managing Director, Enverus Intelligence Research

Production, however, is not what concerns analysts. Getting barrels to buyers is. Completion of Trans Mountain's expansion in 2024 added roughly 590,000 barrels per day of export capacity, buying meaningful headroom. At projected growth rates, available pipeline capacity will nonetheless be fully used by the early 2030s, even accounting for planned brownfield pipeline additions.

Greenfield pipelines take years to permit and construct. Enverus argues that planning must begin now, before capacity runs out and Canadian crude starts trading at a steep discount to global benchmarks.

Federal support for a major new West Coast pipeline remains tied to large-scale carbon capture commitments, a condition that has yet to be resolved. Larger greenfield SAGD projects, meanwhile, require both price certainty and clearer policy before producers will commit capital.

Multiyear planning and construction cycles mean output cannot be quickly increased in response to elevated prices, including those driven by current disruptions in Middle East supply. What is already under construction determines what arrives to market in the years ahead.

Whether pipeline decisions made today will prove sufficient to carry the sector's growth ambitions remains an open question.