A major oil boom is unfolding within the vicinity of the Lesser Slave Lake region, where the Clearwater play has transformed from an overlooked resource into one of Alberta’s fastest-growing oil developments. The surge in drilling activity is creating new opportunities for oilfield workers and local businesses, while raising questions about infrastructure, environmental impacts and how much local communities will benefit.

The Clearwater formation has become a major driver of Alberta’s conventional oil growth, with companies investing heavily in horizontal drilling and enhanced recovery techniques.

Unlike large-scale oil sands projects that can take years and billions of dollars to develop, Clearwater wells can often be brought into production much faster, making the region increasingly attractive to producers.

The Clearwater oil play is unlike traditional oilsands projects that require massive amounts of energy and steam to extract heavy oil, and instead operates via cold flow heavy oil production, allowing crude to flow naturally to the surface without thermal heating or hydraulic fracturing.

The play’s success was unlocked through advanced open-hole multilateral drilling, where a single vertical shaft branches off into multiple horizontal legs to tap into shallow, high-porosity sandstone reservoirs.

Because wells are relatively quick to drill and complete, the Clearwater has attracted major investment from operators such as Tamarack Valley Energy, Headwater Exploration and Spur Petroleum.

Tamarack Valley Energy is a Calgary-based oil and gas producer focused on the exploration, development and production of crude oil and natural gas in Alberta’s Western Canadian Sedimentary Basin.

The company’s operations are concentrated in the Clearwater heavy oil play, including areas near Slave Lake.

Tamarack says it holds more than 850 sections of Clearwater acreage and focuses on responsible energy development, operational efficiency and returning value to shareholders through dividends and disciplined growth.

Company president, founder and CEO, Brian Schmidt, told The Leader the company’s Clearwater operations are concentrated primarily around Nipisi, West Marten Hills and the Jarvie area, with activity now expanding into Pelican and Seal.

Schmidt says the Clearwater’s production potential extends well beyond the current drilling boom.
While primary drilling initially recovers only a small portion of the oil in place, he says additional recovery through water flooding can significantly increase production over time.

“The Clearwater play should continue producing oil for another 50 years,” Schmidt says, adding that the extraction methods used in the region result in a longer producing life compared with many shale oil operations that rely on hydraulic fracturing.

While the exact number of jobs created by Clearwater is difficult to measure, the expansion of drilling activity is expected to support hundreds of direct and indirect jobs across drilling, trucking, equipment maintenance, environmental services and other oilfield sectors.

Schmidt says Tamarack currently operates with an annual budget of approximately $400 million to $450 million, much of which is spent in the field.

The company currently has six drilling rigs operating in the Clearwater region.

He says Tamarack prioritizes hiring local workers and contractors where possible, including Indigenous workers and businesses. According to Schmidt, Indigenous employees make up nearly a third of the company’s field workforce, while many other workers come from Slave Lake and surrounding communities.

Even a small share of Clearwater investment flowing into communities around Slave Lake could represent millions of dollars in economic activity through contractors, fuel suppliers, accommodations, restaurants and other local services.

There is also a broader question of who benefits from the Clearwater boom.

Many production areas overlap with the traditional territories of Indigenous communities, including the Bigstone Cree Nation, creating potential opportunities for Indigenous-owned businesses in areas such as trucking, environmental services, construction and oilfield support.

Tamarack has also pursued a major Indigenous ownership partnership involving its Clearwater infrastructure.

In December 2023, the company announced the sale of an 85 per cent interest in a portfolio of midstream oil and gas infrastructure assets, including pipelines and processing facilities, to a partnership involving 12 First Nation and Métis communities.

Tamarack retained a 15 per cent interest and continues to operate its upstream oil development activities.

Schmidt says the partnership represents one of the largest Indigenous infrastructure ownership agreements in Alberta and provides communities with long-term economic participation in the development.

The Marten Hills and Nipisi areas represent the heart of the Clearwater play, but they also overlap with the Slave Lake and Nipisi caribou ranges. Schmidt says Tamarack works within that landscape by minimizing surface disturbance through its drilling approach.

A typical Clearwater well involves drilling vertically and then extending multiple horizontal legs underground, allowing operators to access large areas from fewer surface locations.

Schmidt says a single pad can support dozens of wells, reducing the number of surface locations required compared with more traditional development approaches.

The Clearwater play is unlikely to transform Slave Lake overnight, but it represents one of the largest sources of new oil activity in the region in years.

The direct number of jobs created is difficult to quantify, but increased drilling and field operations are expected to benefit oilfield contractors, transportation companies, tradespeople and other local businesses.

The longer-term question is whether the region can capture lasting economic benefits while managing the pressures that come with another resource boom.

William Hetherington
Lakeside Leader