Oil and gas sector hopeful Alberta and Ottawa can restore investor certainty
Alberta Premier-designate Jason Kenney is entering office with high expectations from Alberta’s oil and gas sector, as he spent the campaign promising his policies will kick-start the economy and generate tens of thousands of jobs.
It’s a message Tier 1 Energy Solutions CEO Kevin O’Dwyer watched closely during the campaign and hopes an economic rebound is coming.
“I think some people are just waiting to see what the results could be and what he’s capable of doing,” O’Dwyer told Global News.
It was a difficult first quarter for the Edmonton-based company. Ten per cent of its workforce was laid off and for the first time, Tier 1 is relocating assets outside of Canada.
O’Dwyer blames a lack of market access as one factor, but uncertainty around the provincial election played a role as well.
“I think all these mixed messages just creates a sense of: ‘Let’s just wait and see. Let’s make shorter-term decisions.'”
During the Alberta election campaign, Kenney pledged to slash the corporate tax rate and reduce red tape to speed up project approvals, while taking a more aggressive approach towards the federal government. Bill 1 will scrap Alberta’s carbon tax and Kenney will add Alberta to the legal fight challenging the federal carbon tax.
Watch below: Economist says UCP plan can’t make economy rebound overnight
Kenney has also indicated he will remove the legislated cap on oilsands emissions. That promise has caught the eye of the federal government.
“Each province is expected to have their own climate change plan in place, and that cap on emissions from oil sands development is part of that plan,” Amarjeet Sohi told reporters at a clean energy announcement in Calgary.
“We look forward to working with the new government to understand how they will continue to either support that plan or have a new plan that is comprehensive.”
The emissions cap was cited as part of the reason the Trans Mountain pipeline was approved by the federal Liberals, and there have been assurances the cap would also shield new energy projects from scrutiny being introduced through bill C-69.
Watch below: Federal Natural Resource Minister Amarjeet Sohi updates the process on the Trans Mountain Pipeline expansion and working with Alberta Premier-Designate Jason Kenney.
The United Conservative platform does outline an emissions reduction plan, which includes a price on pollution for heavy emitters and emissions intensity targets.
O’Dwyer hopes the economic policies will bring back investment but he believes Kenney needs to be somewhat careful with how he approaches Ottawa.
“I think if we get too aggressive too fast, perhaps the barriers and resistance is going to be there and possibly even grow.”
Which would mean more political uncertainty for an industry struggling to find its footing.
Watch below: NDP Leader Rachel Notley said her meeting with Premier-designate Jason Kenney went well. She said she is looking forward to taking over her position as leader of the Official Opposition.
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