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Oil and gas spending expected to increase by $2B in 2020: industry group

An oil pump jack in Longview, Alta. taken on Jan. 29, 2020.
An oil pump jack in Longview, Alta. taken on Jan. 29, 2020. Dani Lantela, Global News

Editor’s note: This Canadian Press story originally stated there have been five years of declines in the oil and gas industry. A correction was issued that specified there have been declines in four of the last five years. This story has been updated to reflect the correction.

Spending in the oil and gas sector is expected to rise by about $2 billion this year after declines in four of the past five years.

The Canadian Association of Petroleum Producers says it expects about six per cent more will be invested in Canadian upstream energy this year than in 2019, taking to total to about $37 billion, the first increase since 2014 when investment levels reached $81 billion.

READ MORE: Alberta landowners urge farmers to cut power to wells with unpaid debts

The Canadian Association of Petroleum Producers says it expects about six per cent more will be invested in Canadian upstream energy this year than in 2019, taking to total to about $37 billion, which is about half as much as in 2014 when investment levels reached $81 billion.

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It says the “main driver” for the spending jump is an improved economic environment due to provincial government policies, along with growing optimism that new export pipeline capacity will be built.

It lists Alberta’s moves to slash corporate tax rates and ease oil production curtailment levels, as well as Saskatchewan’s regulatory efficiency and recent target to boost oil output by 25 per cent by 2030.

READ MORE: Canadian drillers add most rigs in a week in five years: Baker Hughes

CAPP says non-oilsands oil and natural gas capital investment for 2020 is forecast at $25.4 billion, up four per cent from an estimated $24.4 billion last year.

Oilsands spending is forecast at $11.6 billion in 2020, up eight per cent from an estimated $10.7 billion in 2019 and the first rise in five years.

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