Posted on Oct 17, 2019
Oil and gas drilling at historic low under UCP
Updated drilling rig counts show Premier Jason Kenney and his UCP government’s $4.5 billion corporate tax giveaway has done nothing to help the province’s oil and gas industry.
Since the Kenney and the UCP took office, 15,000 jobs have been lost in the oil and gas sector. And just last month, 12,000 people left the workforce after giving up hope for the UCP corporate tax gift to help them.
“They put all their eggs in the $4.5 billion corporate tax gift basket. Now that their plan has failed, Albertans are the ones left suffering,” said NDP Critic for Economic Development, Trade and Tourism, Deron Bilous. “All we’ve seen is companies boost stock dividends for bankers out east without creating any jobs in the industry.”
According to the Baker Hughes Rig Count, there has been an average of 91 active rigs per week since the drilling season ramped up at the end of July of this year. Compared to the same time period last year, there were an average of 141 active rigs per week - a decrease of 35 per cent. According to ATB, this is a loss of 7,000 jobs connected to the drilling industry.
To make matters worse, the Baker Hughes Rig Count also shows the industry is currently headed for its worst drilling season on record. This includes the depths of the recession in 2016 when the average rig count at this point of the drilling season was 113 rigs.
The record low drilling comes despite Kenney and the UCP making bold campaign promises to “get rigs back in the field,” in their election platform.
Instead, they’ve extended curtailment until the end of next year. Limits on the amount of oil produced were supposed to gradually phase out under the original NDP curtailment plan as the amount of oil being shipped by rail steadily increased by the end of 2019. However, Kenney and the UCP cancelled the crude-by-rail contracts, perpetuating the oil backlog and fiscal pain for at least another year.
“We can now see Jason Kenney and the UCP have completely mismanaged the oil and gas sector with their inability to get our resources to market or attract investment,” said NDP Energy Critic, Irfan Sabir. “Their cancellation of oil-by-rail contracts has left our oil bottlenecked and inflicted pain on the sector. Premier Kenney promised to bring back investment and jobs with his $4.5 billion corporate tax handout. But that clearly hasn’t worked.”