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Strong oil and gas support is good news
Monday, 17 October 2016 - 4:00pm
Recently, the Canadian Association of Oilwell Drilling Contractors set what was then an e-petition record after delivering 34,537 signatures to Parliament in support of Canada’s oil and gas industry.
Here are a few reasons why Canadians from coast to coast should find that news encouraging.
First, every hospital and school in the country is partially paid for by the oil and gas industry. Alberta, Saskatchewan and British Columbia (oil and natural gas provinces) pay an enormous amount of taxes to Ottawa each year but receive far less from Ottawa in funding. Ottawa takes some of the extra money from those provinces and gives it to Manitoba, Ontario, Quebec and Atlantic Canadian provinces through a transfer called “equalization payments.”
Provincial governments that receive equalization payments then use those dollars to pay for hospitals, schools and other services.
Clearly, whether you think Canada needs to reduce its carbon emissions or not, as long as people are going to keep putting gasoline in their cars each week, flying on airplanes and using other products that require oil to make (eg. smartphones), it only makes sense to support Canada’s oil and gas sector rather than using foreign oil.
If we don’t support our industry, think of the consequences. Who do you think will have to pick up the extra cost for health care, education and other services? Hint: you.
One way to help our oil and gas sector, and supporting industries (eg. the manufacturing sector in Ontario that provides parts and equipment to oil and gas companies), is to develop safe pipelines.
Right now, there isn’t enough pipeline capacity stretching from western Canada to eastern Canada. As a result, eastern Canada purchases a lot of oil each year from foreign companies.
In 2013 alone, eastern Canada spent a whopping $26 billion on oil from Saudi Arabia and other foreign countries. Just imagine if those dollars had stayed in Canada – supporting Canadian jobs and Canadian companies; both in turn paying taxes to support our hospitals and schools.
That brings us to a third important point. When Alberta and Saskatchewan sell their oil, they don’t receive the world price for oil, they receive a price that’s often 15% lower. Why? Because Alberta and Saskatchewan are landlocked – they don’t have access to ports for shipping their product globally to other countries – most oil is sold to the United States; a country that takes advantage of our current predicament.
If new pipelines are built, Canada could export worldwide and start to receive the world price for oil. This would mean even more profits, jobs and tax dollars to pay for schools, hospitals and other government services.
Finally, there’s an ethical argument to supporting Canada’s oil industry. If we don’t, do you really want Canada to continue buying oil from countries that see no problem with stoning gay people and treating women as though we were still living in the Stone Age? What about buying oil from a foreign country with a terrible environmental track record?
As long as Canadians continue to use oil and gas products, we should all support Canada’s oil and gas industry. This recent e-petition is a sign that we’re headed in the right direction.
-- Colin Craig works for the Manning Centre and is the author of The Government Wears Prada
This column was published by Sun Media (Toronto Sun, Ottawa Sun, Calgary Sun, Winnipeg Sun, Edmonton Sun) on October 17, 2016