ALBERTA: Canada’s Prime Minister Mark Carney is betting a new pipeline can help revive the country’s oil industry, boost its production and exports, and reduce its dependence on the United States.
Bringing back jobs will be much harder.
In the Alberta oil hub of Fort McMurray – nicknamed Fort McMoney in its heyday more than a decade ago – the tens of thousands of oil field jobs that powered the last boom are unlikely to return, even if Carney gets his pipeline.
Instead, much of the growth in oil sands output is likely to come from automation and efficiency gains rather than large-scale hiring, according to industry forecasts and a dozen interviews with company officials, workers, politicians and academics.
The pipeline backed by Carney would transport one million barrels of crude oil a day to a port on the Pacific coast, expanding export capacity to Asia.
Asked by Reuters what the pipeline would mean for the region’s economy, Carney – a former central banker – cautioned against anticipating a return to the oil-boom days.
“I wouldn’t use the term ‘boom’,” Carney said during a visit to Fort McMurray this month. “I would use ‘sustained growth’.”
More oil without many more permanent jobs could leave Carney politically exposed on two fronts: Critics on the left say his efforts to fast-track the project’s regulatory approval risks sacrificing the environment, while those on the right argue the deregulation should deliver faster economic growth, higher salaries and more oil jobs.
Low job growth could also further fuel Alberta’s separatist movement, though a referendum on whether to hold a vote to leave Canada is expected to fail on Monday.
An August labour forecast by industry group Energy Safety Canada projects that oil sands employment will fall by 920 jobs or 4% by 2035, even as production grows 6%.
A spokesperson for Energy Safety Canada told Reuters that a new West Coast pipeline would likely reverse the projected job decline but may not add many permanent jobs because of the “structural trend” of producing more oil with fewer workers.
“Nobody should expect that something that happened 15 years ago will happen the same way today,” said Dianna De Sousa, chief executive officer of the Fort McMurray Chamber of Commerce.
A spokesperson for Carney declined to comment on the lackluster projections for job creation from the pipeline, referring questions to the Department of Natural Resources, which did not respond.
From 2000 to 2014, Canadian and international oil companies spent billions to build out the mega-mines and other facilities required to extract bitumen, the thick oil found in northern Alberta.
Fort McMurray became a place where workers fresh out of high school could earn six-figure salaries, putting new pickups and pricey boats in their driveways.
Fly-in, fly-out workers – some from as far as 5,000km away – packed on-site work camps as the city lacked housing.
Then came the 2015 oil price crash, followed by a devastating wildfire one year later. Investors’ growing focus on environmental, social and governance criteria combined with the climate policies of Carney’s predecessor Justin Trudeau deepened the slump.
International oil majors exited.
Annual oil sands capital investment fell from a C$35bil (US$24.55bil) peak in 2014 to C$14.2bil in 2024, according to Statistics Canada. The last major new oil sands project, Suncor’s Fort Hills, started up in 2018. — Reuters
