CAPP has said that the Alberta government 2015/2016 budget will keep the province’s oil and gas industry competitive in a turbulent global market, supporting jobs and investment at a challenging time. CAPP President, Tim McMillan said, “Albertans across the province are hurting with the drop in oil prices, from rig workers and service crews, to head offices, small businesses and local corner stores. Now is not the time to put more cost pressures on industry.”
Oil and natural gas companies have announced over 4500 direct layoffs this year, with an additional 23 000 jobs expected to be lost as a result of lower drilling activity. Capital investment in the industry is forecast to decline by over 33% this year, from US$69 billion last year to US$46 billion in 2015. McMillan said, “the drop in oil prices has hurt our industry, and it has hurt Alberta’s public finances. It would be irresponsible to put more jobs at risk. We all must focus on protecting jobs and keeping Albertans working as much as possible.”
According to the budget documents, the oil and gas industry’s payments to the province are forecast to decline 67% this year, from US$8.8 billion last year to US$2.9 billion this year.
Oil and natural gas payments represent 7% of total government revenue this year, a number that is forecast to grow to 15% by 2020. In addition, the industry contributes approximately US$1 billion /y in municipal taxes and has paid nearly US$500 million in GHG related levies since 2007. The industry employs one in every six Albertans, with substantial related employment created in sectors such as hospitality, transportation, food services, consultation, construction and real estate. Each dollar invested in the oil and natural gas sector creates three dollars of value in Alberta’s economy across the province, particularly in rural communities. McMillan concluded, “the global market for oil and natural gas investment is extremely competitive. If we are going to continue to grow Alberta’s oil and gas industry, creating more jobs and increasing public revenues to improve our quality of life, then we must keep Alberta attractive for this future investment.”
Edited from press release by Claira Lloyd
Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/02042015/alberta-still-competitive/