The production of natural gas in Eastern Canada decreased sharply in 1976 but the production of oil continued a normal rate of decline. A total of approximately 5.4 Bcf of gas and 620,000 bbl of oil was produced. This represents a production decrease of approximately 51% in gas and a decrease of 12.3% in oil from 1975. The drastic reduction of gas production was attributed mostly to an oversupply of gas from Western Canada which necessitated a temporary curtailment of considerable local production.

In Eastern Canada, geophysical activity and exploratory drilling declined compared with the previous year. During 1976, total area of oil and gas permits held on the Labrador Shelf, Grand Banks, Scotian Shelf, and Gulf of St. Lawrence was reduced by about 65 million acres to 165 million acres, representing a net surrender of approximately 30% of the total acreage under permit.

Six dry exploratory tests were completed on land areas, and 11 wells were drilled offshore. Hydrocarbon shows were found in 3 wells.

In the Southwestern Ontario region, 58 exploratory and 92 development wells were drilled in 1976, a decrease of 8 exploratory wells and an increase of 21 development wells from the previous year.

Silurian exploratory drilling decreased 17% offshore but there was an increase of 17.5% in the development class. A new Silurian reef success in Lambton County was one of the most significant discoveries in 1976. There were additional development successes in 3 previously discovered gas- and oil-filled reefs.

Several significant gas discoveries were made last year in Lake Erie and a notable development drilling program was undertaken.