Oilpatch advocates tell MPs help needs to be faster, easier to get

Oilpatch advocates tell MPs help needs to be faster, easier to get

OTTAWA — Representatives from Canada’s oilpatch said Thursday they don’t know of a single energy company that has yet benefited from any of Ottawa’s pandemic-inspired loan programs and many think the cost to access them is too high.

Finance Minister Bill Morneau has put billions of dollars on the table to help oil and gas companies, as part of the government’s massive COVID-19 aid packages.

That includes $750 million in what the government is deeming “repayable contributions,” to help companies meet new standards on methane emissions coming from oil production facilities.

There are also different kinds of capital or operating loans available for small, medium and large companies.

But several company owners and industry advocates told a virtual meeting of the House of Commons finance committee that the various programs have very high bars to qualify or are of no interest to the sector when it’s just trying to survive.

Loans for smaller- and medium-sized businesses from the Business Development Bank of Canada and Export Development Canada are also still not ready to roll out weeks after they were promised.

An emergency loan program for large employers has interest rates that are so high it’s almost predatory, said Adam Waterman, the president of the Lloydminster Oilfield Technical Society.

On top of that, applicants have to agree to very specific behaviours, including prohibiting dividends and restricting executive compensation, agreeing to have a government representative on their board, and providing annual climate plans that show how the company is contributing to Canada’s goal of net-zero emissions by 2030.

Waterman said it is ridiculous to ask oil companies to show a 30-year climate plan to get a five-year bridge loan.

“It would have been more direct to say that oil and gas producers and oilfield service companies need not apply,” said Waterman.

And Waterman said the repayable funds from the federal government to help oil producers curb their methane emissions are ill-timed. He said in normal circumstances they would be welcome but right now companies aren’t interested in taking on more debt to do something that won’t immediately improve their bottom line.

“Our priority is survival,” said Waterman.

Both Waterman and Tristan Goodman, the president of the Explorers and Producers Association of Canada, said the emissions fund might get more uptake if the money came through grants.

Goodman said he supports the intention of the loans from the development banks because they are meant to help workers keep their jobs. But weeks later, he said companies are still getting automatic replies to their emailed queries about the programs.

“I know of at least 30 companies that are trying to access those programs and are unable,” he said.

The industry representatives painted a bleak picture of Canada’s oil sector for the committee.

Waterman said in his region, an average of two jobs have been lost every day for the last five years, and that was before the combined economic missile of COVID-19 and an oil production fight between Saudi Arabia and Russia pushed up supply at a time when demand was plummeting. The effect was the collapse of world oil prices.

Peter Kiss, the president of Morgan Construction and Environmental Ltd., says he has laid off 80 per cent of his staff, watched his revenues crash 87 per cent and still considers his company one of the lucky ones because there is still some money coming in.

Kiss said his company is trying to apply for a loan from the Business Development Bank, and has been told they should qualify but has no more information at this point.

This report by The Canadian Press was first published May 28, 2020.

Mia Rabson, The Canadian Press

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Alberta Health Services' central zone jumped from 162 active COVID-19 cases to 178 on Friday. Five additional deaths were reported provincewide, bringing the toll to 323. THE CANADIAN PRESS/Graham Hughes
622 new COVID-19 cases set another daily high Friday

Province confirmed 622 additional cases Friday

City of Wetaskiwin Mayor presenting the AUMA Above & Beyond Award to John Maude and Susan Quinn. Ren Goode/ City of Wetaskiwin.
Wetaskiwin County residents win the AUMA Above & Beyond Award

John Maude and Susan Quinn are being recognized for their role in Wetaskiwin’s sustainability.

Alberta children whose only symptom of COVID-19 is a runny nose or a sore throat will no longer require mandatory isolation, starting Monday.
477 new COVID-19 cases confirmed in Alberta on Thursday

Changes being made to the COVID-19 symptom list for school-age children

There were 410 COVID-19 cases recorded in Alberta Wednesday. (File photo)
Alberta records 410 COVID-19 cases Wednesday

Central zone dropped to 160 active cases

Shaun Isaac, owner of Woodchucker Firewood in Trochu, is awaiting a new shipment during a firewood shortage in the province. All of the wood he has left is being saved for long-time customers who need it to heat their homes. (Contributed photo).
Firewood shortage in central Alberta caused by rising demand, gaps in supply

‘I’ve said “No” to more people than ever’: firewood seller

Conservative leader Erin O’Toole rises during Question Period in the House of Commons in Ottawa on Wednesday October 28, 2020. (Adrian Wyld/The Canadian Press)
Conversion therapy ban gets approval in principle, exposes Conservative divisions

Erin O’Toole himself voted in favour of the bill, as did most Conservative MPs

Pilots Ilona Carter and Jim Gray of iRecover Treatment Centres, in front of his company’s aircraft, based at Ponoka’s airport. (Perry Wilson/Submitted)
95-year-old Ilona Carter flies again

Takes to the skies over Ponoka

Children’s backpacks and shoes are seen at a daycare in Langley, B.C., on Tuesday May 29, 2018. Alberta Children’s Services Minister Rebecca Schulz says the province plans to bring in a new way of licensing and monitoring child-care facilities. THE CANADIAN PRESS/Darryl Dyck
Alberta proposes legislation to change rules on child-care spaces

Record-keeping, traditionally done on paper, would be allowed digitally

Prime Minister Justin Trudeau shakes hands with US Vice-President Joe Biden on Parliament Hill in Ottawa on Friday, December 9, 2016. THE CANADIAN PRESS/ Patrick Doyle
A Biden presidency could mean good news for Canadian environment policy: observers

Experts and observers say even a U.S. outside the Paris agreement may ultimately end up in the same place

People take a photo together during the opening night of Christmas Lights Across Canada, in Ottawa, on Wednesday, Dec. 4, 2019. The likelihood that most Canadians will enjoy a holly jolly Christmas season of gatherings, caroling and travel is unlikely, say public health experts who encourage those who revel in holiday traditions to accept more sacrifices ahead. THE CANADIAN PRESS/Justin Tang
Ho, ho, no: Experts advise preparing for a scaled-back COVID holiday season

Many of the holiday season’s highlights have already been scrapped or are unlikely to take place

Sen. Kim Pate is shown in Toronto in an October 15, 2013, file photo. The parliamentary budget office says a proposed law that would give judges discretion on whether to apply a lesser sentence for murder could save the federal government $8.3 million per year. THE CANADIAN PRESS/Colin Perkel
Judicial discretion for mandatory minimum sentences for murder would save $8.3M: PBO

The result would be fewer people in long-term custody at federal correctional institutions, experts say

Husky Energy logo is shown at the company’s annual meeting in Calgary on May 5, 2017. THE CANADIAN PRESS/Jeff McIntosh
Husky pipeline spills 900,000 litres of produced water in northwestern Alberta

The energy regulator says environmental contractors are at the site

Most Read