Associate Minister of Natural Gas and Electricity Dale Nally is encouraged by a report predicting increased investments and growth in oil and gas.
“We have said all along that there is reason for optimism in oil and gas," Nally, who is also the MLA for Morinville-St. Albert, said. "It is the oil and gas industry that got us here and it is the oil and gas industry that will grow and get us into a period of recovery."
On Jan. 13, the Canadian Association of Petroleum Producers (CAPP) released a forecast predicting a 14-per-cent increase in upstream natural gas and oil investment. According to the forecast, capital spending is expected to reach $27.3 billion this year, a $3.36-billion increase from what it was in 2020.
The overall increase of investment is partly due to the roll-out of the COVID-19 vaccine, with CAPP stating it expects growth in economic activity and energy demand as a result. In Alberta, upstream investment is predicted to increase 18 per cent to a total of $11.8 billion.
The International Energy Agency is projecting the economy will return to pre-COVID-19 levels this year. The agency predicts global demand for oil to grow five per cent by 2030, and Nally said other experts are saying natural gas is going to grow by 15 per cent.
“That’s double-digit growth just on the gas side, so it’s significant,” said Nally.
Keystone XL
However, Nally said he was disappointed to hear reports that U.S. president-elect Joe Biden plans on blocking the Keystone XL pipeline on his first day in office. That day is Wednesday.
In a news conference on Jan. 18, Premier Jason Kenney said the province is deeply concerned with the reports. Blocking the pipeline would be a “serious economic and strategic error,” he said. Ending the Keystone XL would cost Albertans $1 billion, Kenney estimated. The province announced a $1.5-billion investment in the expansion last year.
“Keystone XL simply represents an expansion of that decades-old energy partnership and cooperation between our two countries,” said Kenney.
If Keystone is cancelled, it would affect a pipeline that already crosses the border, Kenney said, creating a precedent to cancel other pipelines already in existence.
“Our main focus right now is working with the Government of Canada to ask the president-elect to respect the undertaking that we understand he gave on Nov. 9 to Prime Minister Trudeau, to engage with us on Keystone XL and related issues," he said.
“In other words, give Canada the chance to make the case for how this is clearly in the economic security and environmental interests of both countries.”
