Category: Economic

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Alberta Economic Ft Mac Politics

Alberta Deficit Expected to Hit Almost $6 Billion in Spite of Higher Taxes

Alberta deficit, higher taxes

The government expects the Alberta deficit to hit almost $6 billion, in spite f higher taxes in some areas due to recent tax increases. In a first quarter fiscal update the province announced the expected deficit, and some of the factors involved are the recent volatility in oil prices, a wildfire season that was more costly than anticipated, and new government spending on necessary expenditures. Around $1.4 billion of the expected deficit is due to operating expense increases in areas like health, education, and human services as well as close to half a billion for disaster assistance. A statement from Finance Minister Joe Ceci explains “The first quarter update highlights the difficult choices we have ahead as we build a budget that is prudent, while creating jobs and protecting the frontline services that Albertans count on. There is no doubt many Alberta families and businesses are feeling the effects of the dramatic drop in oil prices. That’s why our government is focused on building a plan for job creation and diversification of our economy.”

The expected Alberta deficit would probably have been even higher if not for the higher taxes that were recently enacted. Because oil prices are so unpredictable right now there could be significant fluctuations before the fall budget is released according to Brian Jean, the Fort McMurray-Conklin MLA and Wildrose leader. Jean said “This is the largest net financial drop in Alberta’s history. Instead of showing any kind of fiscal restraint, this forecast demonstrates a vacuum of leadership from our government.”

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Economic Ft Mac Politics

Hiring Freeze Voted Down by Regional Municipality of Wood Buffalo Council

Regional Municipality of Wood Buffalo council, hiring freeze

The Regional Municipality of Wood Buffalo council recently voted down a hiring freeze, with the votes tallying 6-4. Councillor Lance Bussieres forwarded a motion to put a hiring freeze in place due to the economic downturn that the area has suffered recently. The goal of the motion was to prevent any hiring for full time positions which were vacant with the exception of positions that the municipality had a legal obligation to fill. Bussieres said “It’s just being financially prudent as an organization. I’ve talked to a number of employees at the municipality, and what they tell me is there’s not a lot of work for them to do. For whatever reason the workload isn’t there. Contrary to what people think, our population is not 120,000, it’s probably closer to [80,000].”

Various Regional Municipality of Wood Buffalo council members gave different reasons for voting against the hiring freeze. Coun. Colleen Tatum felt that a freeze in hiring would demoralize staff, and Coun. Allan Vinni thought that the move would be both ineffective and it would be the same as a vote of no confidence in Marcel Ulliac, the current Chief Administrative Officer. Fort MacMurray Mayor Melissa Blake said that approving the motion for a hiring freeze would be intervening in the responsibilities of the CAO. Blake stated that this would be a slight against the CAO, and said “I’m not going to do that to my CAO, and your CAO.” The councillors who voted for the motion were Ault, Bussieres, McGrath, and Germain, while those against it were Tatum, Vinni, Meagher, Cardinal, Stroud, and Mayor Blake.

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Alberta Economic Ft Mac

Campus Redesign Plan for Keyano College Sees Time Line Changes

campus redesign, Keyano College

Keyano College’s aggressive campus redesign plan is being put on hold at the moment because of struggling economy and future uncertainty surrounding the region. The plan, the Campus Development Master Plan, was very ambitious and included redeveloping a majority of the college campus by the year 2020, but that is no longer the case and things have stalled at this point. Matthew Harrison, the spokesperson for Keyano College, said “The (plan) is quite ambitious. It was also completed prior to the changing economic and political landscape…with these changes, it’s safe to say that timelines have changed. We’re really in a holding pattern to see how the economy settles, and also what happens politically (in the) upcoming provincial budget.” All universities and colleges in Alberta are required to produce a master plan.

The Keyano College Master Plan with the ambitious campus redesign was last updated in 2014. The plan called for the creation of a student residence that included two towers and a modern appeal, as well as a redeveloped and redesigned quad area on the campus. Other changes were also in the plan, such as upgrades to the Suncor Energy Industrial Campus. The Clearwater campus building is also included in the master plan for Keyano College. Harrison stated “It’s hard to predict, but we’ll just have to take it one day at a time. And whether or not those projects kick into gear a few months down the line, or maybe it’s delayed a year, who knows. But that’s the good thing about the planning document — it’s something that’s flexible.”

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Economic Ft Mac Health

Long Lake Facility Will be Closed by Nexen, No Word on Reopening Date

Nexen, Long Lake Facility

The Long Lake facility operated by Nexen Energy was ordered to stop the operation of 95 pipelines due to recent environmental concerns. The company is closing the entire facility down as a result, because they say it is not possible to comply with the suspension order any other way due to the close integration of the affected pipeline infrastructure to the operations that take place at the Long Lake facility. The suspension of the 95 pipeline operations was ordered by the Alberta Energy Regulator, and Nexen has not given any time line about when the facility will be reopened. The company says it may take up to 2 weeks to completely shut down all of the facility operations.

Nexen spokesperson Diane Kossman discussed the Long Lake facility shut down and said in an email that “because of the complex and integrated nature of our Long Lake operations we’re complying with the suspension order, including providing them with necessary documentation, suspending our pipelines, and shutting down our Long Lake oil sands operations.” Bob Curran, the spokesperson for the Alberta Energy Regulator, explained that even if this was known to the regulator the same decision to suspend operations would have been made. “It would have been irrelevant to our decision making. We didn’t feel the assurance we needed regarding those pipelines. Any associated impacts are irrelevant to this decision.” The suspension will not be lifted by the regulator until the company can prove that they have the capability of maintaining the safety of the pipelines involved and the company has provided sufficient documentation in order to convince the regulator of this.

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Alberta Economic Ft Mac Politics

Royalty Review Quick Completion Urged by Canadian Association of Petroleum Producers

royalty review, Canadian Association of Petroleum Producers

The Canadian Association of Petroleum Producers president is urging the provincial government to finish the current royalty review as soon as this is possible so that market stability can be achieved again. In the last year oil prices have been volatile, causing some instability in Alberta and the rest of the country. CAPP president Tim McMillan blames the royalty review for adding uncertainty, and said “We have been very public that a royalty review does put instability into the market. Investors want to know with some certainty what the rules are and what the royalties will be. There is a balance here. If it can be done sooner rather than later, it shouldn’t be rushed. If we get this wrong, it can have long-term impacts on our province that will not be positive.”

The Canadian Association of Petroleum Producers has been very vocal about the royalty review, pointing out that the association did not call for it but that their members are more than willing to work with government officials. The panel in charge of the royalty review is expected to finish their work on the review by the end of the year. No matter what the panel decides the current royalty structure will be in place until at least 2017 according to Energy Minister Marg McCuaig-Boyd. This can provide at least a little certainty for investors in the current market volatility. McMillan also stated “We can’t control the price of oil but we can control our destiny in many ways. This is a difficult time for our employees and companies, but I think it will serve us well to do the heavy lifting now to prepare us for the future.”

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Alberta Economic Ft Mac Health Politics

Pipeline Operations Suspension for Nexen Energy at Long Lake Facility

Nexen Energy, pipeline operations suspension

The Alberta Energy Regulator recently ordered a pipeline operations suspension for the Nexen Energy Long Lake facility, halting 95 pipelines and preventing operations from continuing. The agency issued the suspension and cited “noncompliant activities” regarding pipeline monitoring and maintenance the reason for the suspension. An emulsion spill that allowed 5 million litres of emulsion to leak into the environment last month caused the agency to investigate the site and the operations. AER CEO and president Jim Ellis stated “Protection of public safety and the environment are the AER’s top priority. Given that this company has already had a pipeline failure at this site, the AER will not lift this suspension until Nexen can demonstrate that they can be operated safely and within all regulatory requirements. We will accept no less than concrete evidence. The AER investigation into Nexen’s Long Lake pipeline incident is ongoing. Once the investigation is complete, the AER will publish its findings.”

The Nexen Energy pipeline operations suspension came about after the regulator reviewed information and documents that the company submitted after the emulsion spill. The regulator said that indicated noncompliance with Pipeline Act and Pipeline Rules for Alberta caused the suspension to be issued. Nexen Energy can not resume operations with the suspended pipelines until they provide the regulator with sufficient documentation that can convince the regulator that the company can operate the pipelines safely and in compliance with all applicable laws. The specific cause of the emulsion spill has not been determined yet and the investigation will continue.