Oilpatch players feeling 'nauseous' before federal election - Action News
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Oilpatch players feeling 'nauseous' before federal election

Politicians aren't the only ones with butterflies in their stomachs as we head into the final stretch before the federal election. Oilpatch players are worried about what a change in government might mean for their sector.

But would the Liberals or NDP be so bad? It depends who you ask

Liberal Leader Justin Trudeau (L), NDP Leader Thomas Mulcair (C) and Conservative Leader Stephen Harper talked energy at the leader's debate in Calgary in September. (Mike Sturk/Reuters)

Politicians aren't the only ones with butterflies in their stomachs as we head into the final stretch before the federal election.

"As of last Friday, my stomach is getting nauseous again," said RafiTahmazian, an energy focusedportfolio manager with Canoe Financial in Calgary.

As prime minister of Canada, Alberta is not your only constituency, so you can ignore it for awhile, but eventually you have to pay attention.- Dirk Lever, AltaCorp Capital

You can't really blame him.

The past yearhas been a roller-coaster ride mostly down for the energy sector.

The collapse in prices, the end of the Progressive Conservative dynasty in Alberta, the increase in corporate income taxes, the royalty review, the development of a robust climate change policy, and now a possible change in the federalgovernment. Pass the Gravol.

But would a Liberal- or NDP-led federal government be so bad for the patch? It depends who you ask.

"It's no secretthe Liberals and the NDP have spoken out against the oil industry, and that riles some people here," said Dirk Lever, an analyst with AltaCorp Capital.

Pipelines

Both parties have mixed feelings about the various pipeline projects that have been proposed. Liberal Leader Justin Trudeau has said that he supports Keystone XL, is opposed to Northern Gateway, has withheld judgment on Energy East and givesa conditional yes onTransMountain, depending on community buy-in.

NDP Leader Tom Mulcair is opposed to KeystoneXL and Northern Gateway and is looking for changes to the approval process before supportingthe other two.

This, of course, is a far cry from the Conservative party, whichsupports all the pipeline proposals with the caveat they must pass environmental reviews.

The pipeline industry would prefer not to have to depend on political supportto get its projects approved. According to Brenda Kenny, the president of the Canadian Energy Pipeline Association,that is why a national energy strategy is so important

"If you have more alignment on policy, then in some ways it doesn't matter who's making the decision," Kenny told CBC News. "You're generally moving in the same direction, you have a sense of what the vision is and what are thekey things that matter most."

Climate change

Climate change is an issue that isbeing dealt with head-on in Alberta, with a provincial panel formulating a policy that will be taken to the UNclimate conference in Paris in December.

Federally, the Conservatives wouldrely on the provinces to implement carbon reduction. The other parties are looking to a national plan to reduce carbon, either through a cap and trade system, or a carbon price.

Many energy companies are alreadyon the record supporting a carbon tax for Alberta.

Subsidies

The Liberals and NDP have pledged to phase out oil subsidies to fossil fuel companies, which they say will bring approximately a quarter-billion dollars in revenue to federal coffers in the next several years.

TheCanadian Exploration Expenses (CEE) deduction is their primary target. It allowsenergy and mining companies to rapidly write off expenses related to exploration. The CEE was expanded in the most recent federalbudget.

TheNDP would tighten therules around the deduction, while theLiberalswould exclude energy companies from using it for successful exploration, allowing it onlyfor unsuccessful exploration

"At a time when our economy in Alberta is the worst that I've ever seen in 25 years,I need a federal government focused on a strong and healthy economy to help rebuild the energy sector," said Tahmazian. "To keep our sector going the best itcan."
It seems at least one person in Airdrie, Alta., remembers the fallout of the National Energy Program in Alberta, as this election sign shows. (Stephen Anderson)

Liberal support in oilpatch

Like the rest of Canada, the oilpatch is not of one mind about the election. There are a few keyLiberal supporters in the oilpatch, most notably billionaire Murray Edwards, founder of Canadian Natural Resources, who, according to Lever,would have the ear of Trudeau in the case of a Liberalwin.

Two Calgary inner-city ridings, home to many anoilpatchexecutive, arecompetitivefor Liberal candidates. Trudeau has made multiple appearances in Calgary over the past several years, including two years agoat the Petroleum Club.

At that speech, Trudeaudisavowed his father, Pierre Trudeau's,National Energy Program, while also championing a National Energy Strategy.

Justin Trudeau joked at the time that he wished that itdidn'tfall on some guy named Trudeau to propose a 'national energy' anything.

While energy executives in the city still recall the NEP with a grimace, Lever doesn't think it's coming back."I wouldn't say he's his father's son, he's his own guy. But time will tell."

Although polls this week show the Liberals leading, it is still too early to call the election for anyone. On Monday, oilpatch players will mark their ballots, cross their fingers and hope that whoever wins will view them as an asset instead of a target.

"As prime minister of Canada, Alberta is not your only constituency," said Lever. "So you can ignore it for a while, but eventually you have to pay attention."

With files from Erin Collins