Natural gas was Canada's third largest source of energy production in 2018, representing 22.3% of all energy produced from fuels in the country. By contrast, the share of fuel-based energy production from natural gas in 2013 was 17.0%, indicating a growth rate of approximately 1.06% per year.
Reserves
As of 2017, Canada's gas reserves were estimated , 72% of which is from unconventional tight gas formations in Alberta and British Columbia.
Biogenic gas is produced at shallow depths by microbial activity. The most prolific biogenic gas deposit in Western Canada is the Southeast Alberta Gas Field (SAGF), which is located in southeastern Alberta and southwestern Saskatchewan in the Western Canada Sedimentary Basin and holds an estimated 1.42×1012 m3 of recoverable gas.
Gas hydrates are pure methane deposits formed at low temperature and high pressure conditions. They are typically found in the shallow sea in arctic permafrost regions and continental slopes. In Western Canada, the Mackenzie-Beaufort Sea and the continental slope off Vancouver Island are two areas which have undergone extensive exploration drilling and studies. The gas hydrate deposits in these regions are estimated to hold up to 11×1013 m3 of gas.
Production
As of 2017, Canada was the fifth largest producer of natural gas in the world with a total of . in 2017.
Liquefied Natural Gas Production
There are four LNG plants that serve Canada's domestic demand. Two additional LNG facilities are in the planning stages, with Stolt LNGaz slated to open in 2018 in Becancour, Quebec and Northeast Midstream planning two liquefaction plants in Nipigon and Thorold, Ontario.
Three LNG facilities are in operation in Western Canada as of 2018, and one more is slated to begin operations in 2018:
Elmworth, Alberta LNG facility - Ferus Natural Gas Fuels Inc. Mt Hayes Ladysmith - FortisBC Tilbury LNG - FortisBC Energir (formerly Gaz Metro) natural gas liquefaction, storage and regasification plant Union Gas's Hagar LNG plant, the first to open in Canada
Ferus Elmworth LNG
Ferus Natural Gas Fuels Inc. (Ferus NGF) began operation of their merchant LNG facility in Elmworth, Alberta in May 2014. This facility can currently produce 50,000 gallons of LNG per day with an expansion capacity of 250,000 gallons per day. The facility receives lean gas from a nearby industry host plant.
FortisBC Mt Hayes LNG
FortisBC's Mt Hayes facility is located near Ladysmith, Vancouver Island. The facility was completed in 2011 and is owned in a limited partnership between FortisBC, Stz'uminus First Nation, and the Cowichan Tribes. The facility includes a liquefaction system, vaporization system, and storage tank and is connected to the main transmission line via two pipeline spurs. The primary use of the facility is for peak shaving storage, to ensure a steady supply of gas and maintain lower costs during peak demand periods for local customers.
FortisBC Tilbury LNG
The FortisBC Tilbury Island LNG facility is located in Delta, British Columbia and began operations in 1971. It has the capacity to liquefy 5,000 GJ of gas per day and stores up to 600,000 GJ. Expansion is underway to increase the liquefaction and storage capacities by 34,000 GJ and 1.1 million GJ, respectively.
Pipelines
Across Canada, interprovincial pipelines have the capacity to carry over of gas and even more within the boundaries of the individual provinces. The construction of new natural gas pipelines is controversial. RCMP enforcement actions against Wet'suwet'en hereditary chiefs in 2020 and 2021 at the Coastal Gas Link pipeline led to wide spread protests across the country.
Domestic consumption
Electricity generation
In 2016 natural gas was used to provide 35% of all energy in Canada, double the amount supplied by electricity. Electricity generated by natural gas was 8.5% of the nation's total. Natural gas is used to supply 50% of space heating, and 65% of water heating in homes, similarly 80% of businesses use natural gas for space and water heating. The industrial sector uses natural gas as a source of process heat, as a fuel for the generation of steam and as a feedstock in the production of petrochemicals and fertilizers. Provincially, Alberta is the largest consumer of natural gas at 3.9 billion cubic feet per day.