Alberta oil sands output pegged at 3 mln bpd by 2018

CALGARY, Alberta, June 10 (Reuters) - Output from Alberta's oil sands region, the largest crude reserves outside the Middle East, will rise to 3 million barrels per day by 2018, the province's energy regulator said on Wednesday, even as it slightly lowered its estimate of the region's reserves.

In its annual estimate of the province's oil and gas reserves, Alberta's Energy Resources Conservation Board (ERCB) said it expects production of the tar-like bitumen contained in the oil sands to more than double over the next nine years, from about 1.3 million barrels per day last year.

The forecast is more bullish than one released just days ago by the Canadian Association of Petroleum Producers. Cutting its production estimate for the third time in a year, CAPP estimated that by 2020, oil sands output would only be 2.9 million barrels per day in its most optimistic case.

Both the CAPP and ERCB estimates were based on current and planned projects in the oil sands region of northern Alberta.

The board could not immediately account for the discrepancy between the two forecasts.

The regulator also lowered its estimate of the remaining recoverable oil sands reserves to 170.4 billion barrels from its 2008 estimate of 172.7 billion barrels due to more detailed technical data.

Alberta's conventional oil reserves were pegged at 1.5 billion barrels, down 3 percent from last year and continuing a multi-year decline as new oil discoveries replaced only 77 percent of production. However the ERCB estimates that 3.7 billion barrels of oil will ultimately be found and recovered in Alberta through conventional methods.

Total output of conventional and oil sands crude in 2008 fell 1 percent to 1.85 million barrels per day as planned and unplanned maintenance shutdowns at oil sands projects crimped production.

The ERCB said that 2008 natural gas production fell to about 12.05 billion cubic feet per day, down 6.5 percent from the previous year as only 6,800 wells were drilled, a 14 percent drop from 2007. (Reporting by Scott Haggett; editing by Peter Galloway)