By Greg Nikkel
There are signs of optimism in Saskatchewan’s energy sector, but there are concerns as well around the issue of an imposed carbon tax by the federal government, said Energy and Resources minister Dustin Duncan.
The Weyburn-Big Muddy MLA commented on the firm stance in opposition to the carbon tax at the First Ministers conference held in Ottawa by Premier Brad Wall, a position shared only by the Manitoba premier.
“This is the most significant tax that is going to be levied on our economy since World War Two, and there’s been no economic analysis of what it’s going to do to our economy,” said Duncan.
He pointed out that actions as insignificant as installing a culvert requires documentation about the environmental impact, while for a highly significant tax like this there has been no analysis done at all on what kind of impact it will have.
Saskatchewan has made significant contributions in the effort to curb carbon emissions, such as the carbon capture technology that has been developed and used here in the southeast, said Duncan, and the result is this carbon tax will cause a hurt to Saskatchewan and the western provinces more so than anywhere else in Canada.
In addition, Duncan pointed out that with a new president to soon be installed in the United States, jurisdictions like North Dakota will not be paying a carbon tax, which will immediately put Saskatchewan at a major disadvantage when this tax is unilaterally imposed on this province.
The Weyburn and District Chamber of Commerce is in support of Premier Wall’s decision not sign an agreement that imposes a carbon tax on Saskatchewan.
“Our local businesses consider the protection of the environment a core principle of a sustainable economy. Although, it is important to note that an imposed carbon tax impacts our competitiveness, especially when our energy sector is already suffering from low commodity prices,” said Chamber President Larry Heggs.
“Saskatchewan has made, and continues to make, important contributions toward the reduction of greenhouse gases both locally and globally by developing innovative made-in-Canada solutions in areas like power and agriculture. We hope that the federal government’s decision to implement mandatory carbon pricing reflects these grassroots innovations,” added Heggs.
“The Chamber is confident in the strength of our local business sector in Weyburn and area. Whatever decision is made with respect to an imposed carbon tax, our proven resiliency will allow us to adapt to these changes,” said Twila Walkeden, executive director of the Weyburn Chamber of Commerce.
Meanwhile, there are positive signs in the province’s oil industry, including the drilling forecast for oil wells that for the first time has Saskatchewan drilling more wells than Alberta, said Duncan, also noting that the Fraser Institute has ranked Saskatchewan’s oil sector as the fourth most attractive jurisdiction for investment in the world, rising from seventh place, and number one in Canada, well ahead of Alberta which is now in 43rd place.
Duncan noted he was recently in Calgary, and was told that an analysis by Scotiabank puts Saskatchewan in sixth place out of the top 10 places for gas exploration in Canada and the U.S.
“We’re in a pretty good position. I think there’s a lot of optimism,” said Duncan.
One of those points of optimism was the announcement by Quantum Energy of Arizona that they intend to build a 40,000-barrel-a-day refinery near Stoughton. Duncan said his ministry officials have been working with the company to make them familiar with the processes and regulations in Saskatchewan.
“This is one opportunity we’re paying close attention to, and we are trying to facilitate them in any way we can,” said Duncan. “It’s still pretty early in the process.”
The government is also pleased that Enbridge’s Line 3 replacement pipeline project was approved by the federal government, with the line running through Saskatchewan on its way down to Wisconsin. The hope is that this will be a boost to pipeline manufacturer Evraz once the project gets underway.
One other point of optimism, said Duncan, was the announcement from Crescent Point Energy that they increased their capital budget to $1.45 billion for 2017, with an indication that there will be a significant portion dedicated to drilling of new oil wells in Saskatchewan.
“That’s going to be a big boost to the local economy and to the provincial economy,” said Duncan.
