History of The Petroleum Industry in Canada - Westward Move

Westward Move

Those were the early days in Canada’s petroleum industry. The cradle was in the east, but the industry only began to come of age with discoveries in western Canada, notably Alberta. There, the Western Canadian Sedimentary Basin is at its most prolific. Alberta’s first recorded natural gas find came in 1883 from a well at CPR siding No. 8 at Langevin, near Medicine Hat. This well was one of a series drilled at scattered points along the railway to get water for the Canadian Pacific Railway’s steam-driven locomotives. The unexpected gas flow caught fire and destroyed the drilling rig.

This find prompted Dr. George M. Dawson of the Geological Survey of Canada to make a notable prediction. Noting that the rock formations penetrated in this well were common in western Canada, he prophesied correctly that the territory would some day produce large volumes of natural gas.

A well drilled near Medicine Hat in 1890 - this time in search of coal - also flowed natural gas. The find prompted town officials to approach the CPR with a view to drilling deeper wells for gas. The resulting enterprise led to the discovery in 1904 of the Medicine Hat gas sand, which is now recognized as a source of unconventional gas. Later, that field went on production to serve the city, the first in Alberta to have gas service. When Rudyard Kipling travelled across Canada in 1907, he remarked that Medicine Hat had “all Hell for a basement.”

In northern Alberta, the Dominion Government began a drilling program to help define the region’s resources. Using a rig brought from Toronto, in 1893 contractor A.W. Fraser began drilling for liquid oil at Athabasca. He abandoned the well in 1894. In 1897 Fraser moved the rig to Pelican Rapids, also in northern Alberta. There it struck gas at 250 metres (820 ft). But the well blew wild, flowing uncontrolled for 21 years. It was not until 1918 that a crew led by A.W. Dingman succeeded in killing the well.

Dingman, who played an important role in the industry’s early years, began providing natural gas service in Calgary through the Calgary Natural Gas Company. After receiving the franchise in 1908, he drilled a successful well in east Calgary on the Walker estate (a well which continued producing until 1948). He then laid pipe from the well to the Calgary Brewing and Malting Company, which began using the gas on April 10, 1910.

The earliest efforts to develop western Canadian oil were those of Kootenai Brown. This colourful character - a frontiersman with an Eton and Oxford education - was probably Alberta’s first homesteader. In 1874, Brown filed the following affidavit with Donald Thompson, the resident solicitor at Pincher Creek:

In 1901, John Lineham of Okotoks organized the Rocky Mountain Drilling Company. In 1902 he drilled the first oil exploration well in Alberta on the site of these seepages (now in Waterton Lakes National Park). Despite a small recovery of 34° API sweet oil, neither this well nor seven later exploration attempts resulted in production. The site is now a National Historic Site of Canada.

In 1909, exploration activity shifted to Bow Island in south central Alberta, where a natural gas discovery launched Canada’s western gas industry. The same Eugene Coste who had found gas in Ohio and again in southern Ontario drilled the discovery well, Bow Island No. 1 (better known as “Old Glory”). Pipelines soon transported Bow Island gas to Medicine Hat, Lethbridge and Calgary, which used the fuel for heat and light. Eugene Coste became the founder of the Canadian Western Natural Gas Company when he merged the Calgary Natural Gas Company, Calgary Gas Company and his Prairie Fuel Company in August 1911.