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By Lennie Kaplan
New modeling reveals that Alberta oil sands cumulative investment could be boosted by $364 billion, or 76%, over 25 years (2025-2050) though a new economic deal that keeps our province within a united Canada.
The modeling assumes an increase in Alberta’s oil production to around 7.8 million barrels per day (mb/d) by 2050, roughly aligned with the Alberta government’s roadmap target of 8 mb/d by 2035.
While there are continuing questions on whether this level of oil production is in fact achievable, it appears that investments in such projects as the West Coast Oil Pipeline (WCOP), other announced pipeline expansions and optimizations, brownfield and greenfield oil sands projects, and the Pathways CCS project could move forward under these favourable conditions.
Other key findings drawn from my modeling work regarding the positive impact that Alberta’s oil sands can achieve through Alberta pursuing a new economic deal within a united Canada, include:
- Up to a $26 billion, or 76%, increase in oil sands GDP in 2050
- Up to a $476 billion, or 49%, boost in oil sands GDP over 25 years
- Up to a 22,000, or 58%, increase in Alberta oil sands jobs in 2050
- Up to a $4 billion, or 61%, boost in provincial government oil sands royalties in 2050
- Up to a $77 billion, or 37%, increase in cumulative provincial government royalties over 25 years
Oil sands investors seek the stable policies, rules and regulations that a united Canada can provide; conditions that may not materialize under an independent Alberta.
I believe that the Alberta government needs to be more vocal about how Alberta’s oil sands sector can continue to grow and prosper under a strong Alberta within a united Canada. It is one of the greatest success stories in Alberta and Canadian history, a triumph of fiscal federalism, and it should be celebrated as such.
Lennie Kaplan is a former senior manager in the Fiscal and Economic Policy Division of Alberta’s Ministry of Treasury Board and Finance (TB&F), where, among other duties, he worked on energy issues, including participating on the Clean Energy Strategic Advisory Committee (CESAT) and the Alberta Competitiveness Review. In 2019, he served as executive director to the MacKinnon Panel on Alberta’s Finances.
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