PSAC provides outlook into oil and gas for 2019

By Shaun Penner
February 9, 2019 - 9:53am

GRANDE PRAIRIE --  Companies and workers in the oil and gas industry in the Peace Country had a chance to hear from the Petroleum Services Association of Canada on Friday morning in Grande Prairie, as a look ahead to the industry in 2019.

President and CEO of the association Gary Mar spoke to attendees about the forecast of many areas within the Canadian energy sector.

The forecast was not overly positive, nor was it negative.

PSAC is forecasting an average price of $57 USD a barrel for the benchmark West Texas Intermediate, down from the 2018 average of nearly $65 USD. PSAC is also expecting that the Loonie, as well as natural gas, remain consistent with 2018 valuations.

Mar and the rest of PSAC aim to try to turn those projections up by lobbying to all levels of government.

“I think what’s important for us (as PSAC), is to tell the stories of the people who every single day are bringing energy safely and efficiently out of the ground so all of us can enjoy the quality of life that we enjoy. That’s the message we continue to hammer home with provincial and federal government,” says Mar. “We should be very proud of what it is we do, and the Peace Country is no exception.”

PSAC is also expecting less wells to be drilled in 2019 and is anticipating about a 5 percent drop from the previous year. That, as well as decreased investment in oil and gas since 2014 played a role in the forecast PSAC have laid out.

“To have seen from 2014, to go from $80 billion to $40 billion dollars (in capital investment), that’s a pretty big drop. The reason is partly because we are not as competitive in Canada and we don’t have market access outside of the United States.”

Mar states that getting pipelines built would play a huge role in getting Alberta oil to the global market, which would drive prices up and lead to more investment, as well as more wells being dug.

He also would like to see the oil and gas industry put on the same playing field as industries such as manufacturing in Ontario by the federal government. Mar uses the comparison of the job losses after General Motors announced the closing of a plant in Oshawa, which would put approximately 2,500 people out of work.

“I don’t discount the importance of those jobs in Oshawa. But those kinds of job losses are being experienced every week and every month, and have been for years here in the energy sector,” states Mar. “The health of the energy sector really is an indicator of what is going to happening in the manufacturing sector in places like Ontario and Quebec.”

“I’d be happy to go to a Ford truck plant in Ontario and say, ‘who buys a lot of trucks?’” declared Mar. “Go out here in Grande Prairie and look in the parking lots. It is essential to the kind of business we do here in Alberta.”

Mar also announced that PSAC’s 25th annual Stars and Spurs gala in Calgary last month raised $1.4 million for STARS air ambulance. Mar says that despite the crisis in the oil and gas industry, he is pleased companies are still willing to support a worthy cause.

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