Conservatives ask government to make good on promises to O&G sector

Canadian oil and gas workers are being particularly hard hit by this crisis with the double whammy of historically low oil prices and the economic shut-down.

Last week, Finance Minister Bill Morneau told Parliament that the federal government would announce financial tools to help small and medium energy producers in a matter of ‘hours or days,’ and ‘not weeks.’ Nine days later, Canadian energy workers are still waiting for the government to provide this desperately needed help.

Conservatives are urging the Liberal government to deliver support for Canadian energy workers and businesses, and suggesting immediate actions they could take.

  • Rural and remote communities and Indigenous businesses – where resource development is the primary source of jobs – are feeling the immediate impact of this crisis the hardest.
  • Oil and gas employers were struggling before the COVID-19 crisis. Weakened by hostile federal policies and legislation, and compounded by external factors since 2015, the human consequences of these attacks on Canadian energy have been devastating:
    • 200,000 jobs lost and $200 billion in cancelled projects.
    • Since March 7th, energy companies trimmed $8.5 billion dollars in planned spending in Canada this year.
    • The active drilling rigs count dropped by more than half this week, to only 42, down from 260 in February.
    • This equates to job losses of 4,360 direct jobs and 33,790 indirect job losses – and that is just the drilling sector.
  • Even the Finance Minister acknowledges that the energy sector is disproportionately affected by the current health and economic crisis. Government must act with two aims in mind: emergency measures to secure the short-term survival of energy employers and workers, and longer-term measures that will ensure the sector's recovery and future growth in Canada.  
  • The government should focus on measures that achieve these primary objectives: tools that increase liquidity, with particular focus on small and medium size operators; improve competitiveness by reducing costs, cutting red tape, and providing certainty for investment and proponents; increase and diversify market access while working towards domestic Canadian energy supply and security by completing and adding new pipeline capacity; and sustain employment – both maintaining existing jobs and getting people back to work.

Conservatives urge the government to finalize and release their action plan to help energy workers and the oil and gas sector. They should:

  1. Deliver on their promise to provide financial tools to increase liquidity and to recapitalize small and medium oil and gas employers, including credit facilities such as loan guarantees and accounts receivable insurance.
  2. Reduce costs by cancelling the carbon tax - Canada is the only one of the world’s top ten oil producers with a carbon tax which is an added cost and barrier to investment, and makes life less affordable for all Canadians; and immediately put on hold plans for the globally unprecedented Liberal fuel standard that also applies to natural gas and industrial buildings and will hike costs on refining, trucking, manufacturing and ultimately consumers. 
  3. Encourage investment in Canada by working with regulators to speed-up assessments for the twenty-billion dollars’ worth of oil and gas projects in the queue, including the Énergie Saguenay LNG plant in Quebec, while maintaining the evidence and science-based approach with the highest standards for which Canada is renowned.
  4. Provide regulatory certainty by committing to overhaul Bill C-69, and immediately adopt all the Senate amendments that were supported by the private sector and all provincial and territorial leaders. 
  5. Expand access to export markets and get pipelines built by committing to use every federal tool to expedite construction of the Trans Mountain Expansion – its completion is now an economic emergency; work with the proponents and the United States to advance the Keystone XL and Line 3 replacement pipelines; repeal C-48, the oil shipping ban, and work with proponents to set the conditions for a dedicated export pipeline to the growing Asia Pacific markets, and for a west to east cross country pipeline to secure domestic supply and export to Europe.

The tens of thousands of Canadians in the energy sector who are out of work or will be laid off shortly are depending on this Liberal government to act now - otherwise they will not have a job to return to. No measure should be taken off the table. During these unprecedented times Canadians are counting on the government now more than ever to step up.

A more detailed backgrounder is here: Conservative Backgrounder on Support to Energy Workers