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Oil sands spends $2.4 billion on Indigenous partnerships

New data shows increased Indigenous participation in the oil sands’ far-reaching supply chain, creating jobs and economic opportunity.

A survey conducted in 2020 by the Canadian Association of Petroleum Producers (CAPP) shows the increasing role of Indigenous suppliers to the oil sands industry. In 2019, about $2.4 billion was spent on procurement from Indigenous businesses, which is 16 per cent higher than in 2018 (about $2 billion) and 53 per cent higher than in 2017 (about $1.5 billion).

CAPP president and CEO Tim McMillan says, “The industry is continuously working to enhance opportunities for reconciliation, including business partnerships that generate sustained economic, social and community benefits for Indigenous communities through responsible resource development.”

The number of Indigenous suppliers has also grown, from 263 in 2017 to 275 in 2019, with cumulative procurement spending in the three-year period 2017 through 2019 totalling about $5.9 billion. 

Indigenous supply chain businesses participating in oil sands operations include construction, camp operations and catering, equipment services, transportation, environmental, drilling, engineering services, and retail, among others.

“Indigenous employment in the industry is critical, contributing skills and local knowledge that are essential to project success and continued operations.”

Tim McMillan, CAPP president and CEO

In addition, the survey shows oil sands producers are continuing their commitment and engagement in the communities where they operate, increasing the total amount of money put into community investment, consultation funding and other initiatives in Indigenous communities. The total for these activities reached $64.2 million in 2019, compared to $58 million in 2018, and $41.8 million in 2017.

As Indigenous businesses grow their participation in resource development, Indigenous people are a growing proportion of oil and natural gas employment, making up 7.4 per cent of the industry’s workforce in 2019 (up from 4.8 per cent in 2018). For comparison, Indigenous people make up 3.3 per cent of total employment in Canada.

McMillan notes, “The industry is proud to support education and training initiatives, and strives to engage with local communities. Indigenous employment in the industry is critical, contributing skills and local knowledge that are essential to project success and continued operations.”