Country falls out of top 10 with energy executives, survey finds
Petroleum industry executives and consultants increasingly view Canada as a less attractive place to invest in oil and gas projects, especially in comparison to the U.S., according to a survey conducted by the Fraser Institute.
It marked the first year in which none of the top 10 jurisdictions, as viewed by industry insiders, were located in Canada. Nine out of 10 were located in the U.S. with Texas, Oklahoma and Kansas leading the way. “The take-away for Canada is we’re becoming increasingly less attractive to invest in than our neighbours, practically across the street,” said Ken Green, a co-author of the survey and resident scholar and research chair in energy at the Fraser Institute. Within Canada, only Alberta is considered a “large reserve” holder as it has the third largest oil and gas basin in the world. Among large reserve holders, however, it ranked third in terms of its perception as a place to invest, behind Texas and Russia — but still ahead of eight other countries including Venezuela, Iraq and Nigeria. The Fraser Institute’s 2018 Global Petroleum Survey polled 256 energy insiders, more than 50percentofwhomsaidthey were a manager or higher up, and looked at 160 jurisdictions including all provinces and territories in Canada, except Nunavut and Prince Edward Island. Participants answered questions about regulatory enforcement, trade barriers and other areas and their answers were averaged into a “Policy Perception Index.”
As the survey is multiple choice and does not offer causal reasons for why any jurisdictions ranking dropped or rose, it is difficult to draw firm conclusions about declining scores. Still, Green highlighted issues which he believes contributed to a declining view of Alberta as a place to invest, given that its ranking dropped to 43rd overall from 33rd last year. “The concerns expressed by people are regulatory,” said Green. ” B.C. and Nova Scotia both improved their overall scores; but the others saw their scores fall by margins large and small. While Alberta dipped 10 rankings in a year, it had been ranked among the top 20 jurisdictions between 2012 and 2014. The report noted higher personal and corporate income taxes, as among the reasons for its fall.