The Alberta government and the energy industry could create more than 24,000 new jobs for Albertans and grow the province’s economy by nearly $5 billion over the next three years by working together to enhance competitiveness. The analysis comes from a newly released report: “A Competitive Policy and Regulatory Framework for Alberta’s Upstream Oil and Natural Gas Industry” by the Canadian Association of Petroleum Producers (CAPP).
The report notes that industry continues to face mounting costs and barriers to growth due to changes in provincial and federal government policies and regulations related to methane emissions, carbon pricing, well liability and closure, and caribou management, among others. In addition, low global commodity prices, changing market dynamics, and new policy directions in the United States have led to negative impacts on oil and natural gas investment and competitiveness in Canada.
“The competition for capital in our business is fierce,” says Rob Dutton, chair of the CAPP Board of Governors. “It goes to the area, the project, and the basin with the best return. Alberta and Canada are becoming an increasingly more difficult place to attract capital.”
The report provides recommendations on new competitiveness measures that could be created to attract investment and create jobs in Alberta’s oil and natural gas sector, while protecting the high standards already in place for health, safety and environmental regulation. Through collaboration with government on essential policy challenges, the energy sector can attract new investment to Alberta and improve its competitiveness.
“Our proposal to streamline provincial and federal policies and regulations has the potential to achieve regulatory efficiencies, eliminate duplication and create a framework for shared sustainable prosperity in Canada,” says Tim McMillan, president and CEO of CAPP.
By working together, CAPP estimates unemployment in Alberta can be reduced nearly 25 per cent, generate $4.5 billion in gross domestic product, $207 million in additional income tax, and $79 million in additional royalties in the near term, on an average annual basis.