OTTAWA – Prime Minister Justin Trudeau travels Wednesday to Alberta, where the battered oil sector will be looking for strong signals that Ottawa is serious about helping deliver its controversial commodity to tidewater.
The president of the Canadian Association of Oilwell Drilling Contractors said Tuesday the industry isn’t looking for a handout — just federal support on the contentious issue of building pipelines.
Mark Scholz warned if the industry can’t get its product to market, then Alberta businesses are going to fail.
“What I would be looking for is a real strong indication from the federal government that they’re serious about pipelines, they’re serious about getting market access for us and that they’re willing to put some political capital on the line,” Scholz said in Ottawa, where he participated in a conference.
Trudeau’s visit to Alberta comes as low commodity prices decimate business and government revenues in the resource-dependent province, forcing companies to lay off workers.
Federal Finance Minister Bill Morneau declined Tuesday to answer several questions about whether Ottawa would provide targeted assistance for Alberta.
Instead, Morneau said the federal government’s upcoming budget will include spending plans to invest in Canada’s entire economy, which he argued will help struggling provinces like Saskatchewan and Newfoundland and Labrador as well as Alberta.
Morneau confirmed that Alberta is working on an application for up to $250 million in federal cash under the fiscal stabilization program, a plan designed to help provinces struck by big year-to-year declines in revenues.
The Newfoundland government, which has also lost revenues in the oil-price slump, indicated Tuesday that it intends to make a claim under the stabilization program this spring. The province could be eligible for a maximum of about $32 million under the program.
Morneau said he’s unsure whether Newfoundland and Saskatchewan would qualify for the program, although they could apply.
A senior government source, who wasn’t authorized to disclose details publicly, recently said Ottawa was looking at potential solutions for Alberta, including speeding up already promised infrastructure spending and adjusting the typical, per-capita infrastructure funding disbursement formula to reflect economic need.
Trudeau has pledged to pump an additional $60 billion over 10 years into infrastructure projects, but only $17.4 billion was earmarked to flow during the Liberals’ first four-year mandate.
Ottawa is also said to be considering whether to increase direct transfers to individuals, perhaps through modifications to the employment insurance program.
The Liberals promised during the fall election campaign to enhance EI by, for example, reducing the waiting time for benefits to kick in.
But Alberta’s workers might have to wait a little longer for EI changes, federal Labour Minister MaryAnn Mihychuk said Tuesday.
She said she didn’t foresee any EI adjustments before the federal budget, expected next month at the earliest. But when pressed on the issue, she said she wasn’t sure if something on EI reform would be unveiled before the budget.
Mihychuk added the government is looking at “every avenue” to try and help Alberta, Saskatchewan and Newfoundland in a “meaningful way.”
For the Prairie provinces, however, the pipelines are a key concern for governments and the oil and gas sector.
Trudeau’s trip takes place as the regional battle over pipelines heats up.
Earlier this month, the premiers of Alberta and Saskatchewan expressed dismay after Montreal-area municipal leaders publicly voiced their opposition to the proposed Energy East project, which would transport Prairie oil through their territory to tidewater in New Brunswick. They argued that potential threats to the environment outweigh any economic benefits.
Saskatchewan Premier Brad Wall has questioned whether Quebecers should continue to expect billions in equalization payments if they won’t support the export of resources that help drive those payments.
On Monday, he challenged Trudeau to take a stand and support the project.
“We need a champion for the energy sector,” Wall said after delivering a speech in Regina.
Pipeline politics have also dominated debate in Parliament, where the Conservatives have accused the Liberal government of causing more harm to Alberta workers.
Last week, the federal government announced additional environmental reviews to bolster public confidence in the pipeline assessment process, including more consultations with indigenous communities.
Environmental groups argue any new pipeline approval by Ottawa would undermine the Liberals’ vow to cut greenhouse gas emissions.
Note to readers: This is a corrected story. An earlier version had an incorrect spelling for Scholz’s last name.