February 26, 2018
The President of the Canadian Association of Petroleum Producers today issued a dire warning to all levels of government: if we do not export Canadian energy, we will just be exporting Canadian jobs.
“”We need pipelines – not barricades – to supply the world with more Canadian energy,” said Tim McMillan, President and CEO of CAPP, in a press conference this morning. “Energy jobs and investment will leave Canada for other countries unless there are changes to encourage growth the industry can build on.”
It is the first chapter of A Global Vision for Canadian Oil and Natural Gas that McMillan is spearheading to alert both ordinary Canadians and governments to a reality where taxes and regulations are hindering investment and growth in the energy sector.
“Canada is falling behind other countries in attracting oil and natural gas investment ot create job and national prosperity for Canadians,” he said. “Across Canada, government costs and regulatory barriers are on the rise – making it harder to grow out industry and create and support jobs for Canadians.”
With recent tax changes in the U.S. to encourage investment and growth, the time is now to create an environment in Canada to attract investment, said McMillan.
“Today Canada’s number one energy customer – the U.S. – has become our number one energy competitor,” he said. “If we do not export Canadian energy, we will just be exporting Canadian jobs.”
While acknowledging that renewable energy is on the rise, McMillan feels that Canada is ignoring the fact that the demand for oil and natural gas is on the rise as well, and that those markets are hungry for Canadian energy.
“Around the world capital investment in the oil and natural gas sector increased globally in 2017, but was down in Canada,” he said. “Total capital spending on Canadian oil and natural gas was $45 billion in 2017, down 19 per cent from 2016 and 46 per cdnt from 2014. In comparison, capital spending on oil and natural gas in the United States last year increased by 38 per cent to $120 billion.”
The report, A Global Vision for Canadian Oil and Natural Gas, is the first in a series of economic reports to be released by CAPP this year.
The value of the energy sector in Canada is considerable, given that it has created $19 billion in annual government revenues in 2015 and accounted for 533,000 jobs across the nation in 2017.
To encourage growth, McMillan laid our a four-point vision for the oil and natural gas sector “that creates jobs for Canadians and national prosperity”:
• Global connection for Canada’s oil and natural gas resources is essential;
• Globally competitive policies that increase the country’s ability to attract capital are needed to create jobs and national prosperity;
• Any climate plan must be comparable to other jurisdictions competing for the same global capital; and
• Government policies must spur and accelerate innovation and technology in the oil and natural gas sector.
Without action, McMillan warns, the industry will continue to languish – citing the current Trans Mountain pipeline squabble and the numerous NG projects that are dying on the vine as examples.
“At one time there were more than 20 liquefied natural gas export projects proposed in British Columbia,” he cited. “To date, only one small-scale project has come to fruition.
“We operate in one of the world’s most stringent regulatory environments,” he continued. “It’s important that we have a robust regulatory framework that meets environmental goals, but not one that creates additional costs, delays and inefficiencies.”