By Sheldon Spackman

“Texas and Louisiana have been eating our lunch” says McCuaig-Boyd on energy investment

Jun 11, 2018 | 3:15 PM

Alberta’s Energy Minister spoke of plans to continue diversifying the province’s energy sector during a visit with the Red Deer and District Chamber of Commerce on Monday.

Speaking to over a dozen local business leaders during a roundtable discussion, Margaret McCuaig-Boyd said three new incentive programs created through the recently passed Energy Diversification Act will result in thousands of new jobs and more than $10 billion in additional investment for the province.

“[With] petrochemical facilities we’re looking at incenting another round like we did with the first round of $500 million in royalty credits,” she explains. “Last time we had two projects and we know for that investment we can get $5-6 billion of investment in Alberta and thousands of jobs in construction and running the site. Then all the work that comes with the service sector and that’s pretty important to places like here in Red Deer that can help be contractors to those projects.” 

Government officials say the new programs provide a combination of royalty credits, grants and loan guarantees designed to encourage energy diversification like petrochemicals and partial upgrading.

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In total the $2 billion investment is available for private industry to apply for under Round 2 of the Petrochemical Diversification Program, the Petrochemicals Feedstock Infrastructure Program and the Partial Upgrading Program.

Until now, McCuaig-Boyd says places like Texas and Louisiana have been “eating Alberta’s lunch” when it comes to attracting diversified energy investment.

“We know that once these projects are operational, we can go head-to-head with Texas and Louisiana but sometimes the upfront costs are a little bit more,” she admits. “We know that we have some of the best technical workforce in the world, we know that it’s a good place to invest, we’re a stable country, we’re a stable province and so there are lots of reasons to make Alberta your choice.”

Robin Bobocel, CEO – Red Deer and District Chamber of Commerce says despite some cautious optimism throughout the energy sector, there are still lots of pressures for many businesses.

“We’re nowhere close to being where we were pre-oil collapse,” says Bobocel. “There are some folks who are still holding off on making their investment decisions but we’re hoping that changes soon.”

He acknowledges, however, that there appears to be a plan going forward with respect to getting Alberta’s energy industry back on its feet.

“There seems to be a multi-pronged approach, she talked about not just oil and gas but electricity and some climate change issues as well, so good discussion,” adds Bobocel. “We’re always looking out for ‘What are the long-term impacts of some of the decisions that are being made today?’ with respect to TMX – the Trans Mountain Expansion. The federal government stepped in and bought the project, ‘When are taxpayers going to get a return on that investment?’ is where our concern is.” 

Energy Industry companies looking to take advantage of the province’s new diversification incentives can submit applications for the Partial Upgrading Program until September 4 and can submit applications to the Petrochemicals Diversification Program and Petrochemicals Feedstock Infrastructure Program until October 1.

Click here to access Energy Diversification Act program applications.