Alberta’s Kenney calls on Trudeau to deliver on his bailout promises

Gary Park

for Petroleum News

The latest round of layoffs by Canada’s largest fossil-fuel companies and the withdrawal by Canada’s top banks from lending to coal and the full range of oil developments has rattled, among others, Alberta Premier Jason Kenney.

On the heels of layoffs by TC Energy and Suncor Energy, Kenney said the trend is nothing less than a state of “economic emergency” for his province.

“The government of Canada would be moving heaven and earth if we saw layoffs of this scale in the central Canadian manufacturing industry,” he said.

“This truly is a jobs crisis and an economic emergency and it deserves to be responded to here in Alberta the same way it would be in Ontario and Quebec.”

Kenney said he is again calling on the government of Prime Minister Justin Trudeau to “do no more harm” to Alberta’s oil and gas sector, urging Trudeau to press the pause button on his administration’s proposed Clean Fuel Standard, which would make Alberta’s energy companies uncompetitive on the global market.

Trudeau and several of his cabinet ministers have promised aid over the past six months, with hints of a C$10 billion bailout. Nothing has happened.

Kenney also pleaded with the companies to keep their workforces intact, by acknowledging the “big profits they've made for their shareholders based on the hard work of those employees.”

Layoffs

A spokeswoman for the company said the emphasis has been on transforming the company in recent years to rely more on data and technology to improve its efficiency.

Suncor also slashed its capital budget earlier this year by C$1.9 billion and reduced its prized quarterly dividend by 55%.

TC Energy (formerly TransCanada) said it was cutting jobs in its natural gas division, including almost 60,000 miles of pipelines, because of low demand and declining revenues as a result of COVID-19, but it would not provide any numbers beyond saying its Canadian gas operations and projects team was being restructured.

The Canadian Association of Petroleum Producers said 28,000 industry jobs have been lost across Canada this year, while the Canadian Association of Oilwell Drilling Contractors estimates its member companies have reduced their payrolls by 20% to 50%.

The Canadian petroleum industry felt a severe jolt earlier this year when Norway’s US$1 trillion wealth fund said it was withdrawing from the Alberta oil sands.

RBC v ANWR

“Due to its particular ecological and social significance and vulnerability, RBC will not provide direct financing for any project or transaction that involves exploration or development in the ANWR,” said the bank’s updated policy guidelines for sensitive sectors and activities.

An RBC spokesman said the bank is “committed to finding ways to balance the transition to a low-carbon economy, while supporting efforts to meet global energy needs and our energy clients.”

Dana Tiza-Trann, chief of the Vuntut Gwitchin First Nation in the Yukon, said his community is now “looking to all major banks in Canada to come into the sunlight with RBC.”

A year ago, Scotiabank, a major provider of fossil fuel financing, announced it was investing C$100 billion by 2025 to lower the impact of climate change and said it was assessing the climate risks of its commercial and corporate clients.

The Bank of Canada (the Canadian equivalent of the U.S. Federal Reserve) has warned that banks lending money to the oil and gas sector are exposed to potentially destabilizing risks, making climate change a vulnerability to the financial system.

The Business Council of Canada has insisted companies have an “obligation” to disclose how climate change will disrupt their plans.

- GARY PARK