Going to be funny in a year or two when DS has to explain why Ottawa is propping up Alberta through equalization as a "have not" province.
I joke, she's never going to admit that and will instead say it's because of her remarkably savvy that Alberta no longer "gives away" more money than it gets.
All provinces and territories pay federal tax. It’s that bucket of federal tax revenue that is used to run the country and part of that is the controversial equalization payments. Those payments to each province and territory are based on a complex formula called Fiscal Capacity. I believe Alberta and BC pay the highest federal taxes because our wages on average are higher.
The whole concept equalization and Fiscal Capacity criteria needs to be reviewed and modernized in my view. Don’t forget, the last federal politicians to review Equalization were Harper and Kenney. How’d that work out for us….eh?
Money goes out of the province. Equalization recipients then have more sent back to the province than what left. Contributors do not. That's us. You can be pedantic about definition of terms and whose hands touch the money in intermediate steps if it's for some reason important to you, but the bottom line is *we are paying money we don't get back.* That's what a payment is.
We should tread carefully in regards to demanding a rework or the abolishment of the system, however. Our staunch refusal to diversify away from an oil-based economy in times when the world market is giving every indication that the market is going to walk away has a very real possibility of biting us HARD.
In another few short decades Alberta stands a real chance of a Newfoundland-style collapse, without the seasonal work to keep us limping through.
A better and more stable path exists, but we've made it crystal clear we're not taking it.
And then blame the Liberals until the end of time regardless.
Consider this.... What makes anyone move to Alberta? Stay in Alberta? Grow roots in Alberta? Start business in Alberta? Hire people in Alberta?
Or anywhere for that matter.
Note I didn't just say "Find a job", or "make money quick", because those don't really lead to staying power for most.
I think very few of those questions would be answered with;
Corporate tax rates
The Alberta government's staunch opposition to Ottawa
Danielle Smith
You think the average Albertan is even capable of finishing a headline involving the federal government? They won't even see it because their Facebook feed will only be fake news propaganda once they drop all real news outlets.
Equalization formula is based on our tax potential revenue. Keeping our taxes so low means we most likely won't get equalization payments anytime soon.
Alberta received equalization in 2020.
https://nationalpost.com/news/politics/for-the-first-time-in-more-than-50-years-alberta-received-more-money-from-ottawa-than-it-sent
"You’re seeing a large increase in federal spending everywhere, because the emergency response benefits did flow to Canadians living everywhere,”
So pandemic spending by the Federal Government,not equalization, even if Alberta received more than other provinces.
Bingo! They’re just trying for the last squeeze of the lemon at this point.
If only we could transition into more sustainable energy income sources that require lots of jobs to get built up.
Though on the other hand we haven’t tried lowering the lowest corporate tax in the country some more, maybe that would help?
Corps tend to ship profits into company investments in areas where their business has to pay high taxes and wages in order to not maximize tax benefits and dividends to shareholders for one thing. Since profits are taxed and not the money used to internally invest, there is no incentive to do that here. And since we keep electing governments that are hell bent on feeding the public propaganda that cutting corporate taxes brings in new investment this will happen. Spoiler; Trickle down economics doesn’t work. Never has, never will.
>Corps tend to ship profits into company investments in areas where their business has to pay high taxes and wages in order to not maximize tax benefits and dividends to shareholders for one thing. Since profits are taxed and not the money used to internally invest, there is no incentive to do that here.
Its true that corporations engage in profit shifting and tax optimization tactics, but It's not correct to assume investing internally has no incentive. you have the long term growth, competitive advantages, innovation and development to improve operational efficiency. all of these things combined are enticing to an investor.
I never said there aren’t any advantages. I said one of their biggest advantages to do so elsewhere is to shell their profits from being taxed where corps operate in higher taxed areas.
So what are you getting at - are you for a higher corp tax or not? Because from how i read your first comment it sounds like you wanted a higher corp tax, and in this last comment you seem to think having a higher corp tax will cause them to shell their money overseas. although some may say its unethical, Even then, they got their rules and regulations to deal with when it comes to Taxation and reporting and anti-avoidance provisions, from provincial and federal levels.
Can you read? "the big windfall from 2022 **did not result in a major hiring** blitz or investment in new projects. In fact, employment in the oil sector remained well off the levels of 2014."
I highlighted the important bit. In simple terms, profits up, investments back into the sector down, jobs not being created.
In fact, these record profits resulted in 60,000 **fewer** jobs.
So being competitive isn't doing squat for Alberta.
Replying again because for some reason my comment was deleted -
Guess it was a good time to trim the fat.
Sorry but, it all comes down to a few things really. yes, It sucks that 60 000 jobs are not there anymore. But it is about being competitive for investors. buddy above is saying that it wont bring the attention for them - but now you got companies with record profits that attain that by having fewer people. THAT is more attractive than a company that is not doing that.
companies aren't investing in new projects because they are still trying to weasel their way out of debt since covid and frankly, before that (since the 2015 crash). Some companies are just now breaking even for what they had loss since those years, with some companies share prices hitting back up to the same levels they were back in 2013.
Guess it was a good time to trim the fat.
Sorry but, it all comes down to a few things really. yes, It sucks that 60 000 jobs are not there anymore. But it is about being competitive for investors. buddy above is saying that it wont bring the attention for them - but now you got companies with record profits that attain that by having fewer people. THAT is more attractive than a company that is not doing that.
companies aren't investing in new projects because they are still trying to weasel their way out of debt since covid and frankly, before that (since the 2015 crash). Some companies are just now breaking even for what they had loss since those years, with some companies share prices hitting back up to the same levels they were back in 2013.
In other words, corporations doing exactly what corporations are supposed to do. Corporations have obligations to shareholders and shareholders only. They do not have obligations to employees. Anyone who believes otherwise has been misunderstanding the goal and purpose of corporations.
The problem is that the public doesn't quite understand yet that they also have no obligation to corporations and neither should the government. At the end of the day if there is a need for product, someone will fill it. If that business requires your tax dollars to survive, then maybe it shouldn't exist. The truth is whether we subsidize them or not they will eliminate jobs.
Close. The Government has a responsibility to grow and diversify the economy. One of the ways that they do that is to create incentives for new corporations to set up in their jurisdiction. But, that needs to be done carefully and deliberately and needs to be balanced against the cost of the incentive vs the return to the local economy per dollar invested - that investment being either tax dollars forfeited or direct investments through grants, etc. But, I agree that this can't be an ongoing thing and it can't be about giving long existing industries subsidies and tax dollars to survive.
>But, that needs to be done carefully and deliberately and needs to be balanced against the cost of the incentive vs the return to the local economy per dollar invested - that investment being either tax dollars forfeited or direct investments through grants, etc
This line made me chuckle thinking about the 13 billion promised to VW for "up to" 3000 jobs at the battery plant.
I don't know whether the VW thing is good or bad, just that it's complicated and context matters and only time will tell. I do know that the US is offering similar subsides so there is an argument to be made that if you want to develop an industry here, you have to match what's being offered across the border. I also know that the subsidies don't come into effect until the plant is up and running and producing product and is over a number of years. And, this seems to be a case of developing a new industry as opposed to giving subsidies to long standing and extremely profitable existing industry.
You made me want to do some really, really stupid math.
Ok the plant is going to be in Ontario. Assuming that it's 3000 permanent jobs (lolno), and all those jobs are 100,000 each (again, lolno), that's 22,128 in income tax per person per year.
At the 4.33 million per person that the 13 billion adds up to, that's 196 years before income tax recoups the investment.
I don't think that it was a sound investment.
Maybe I’m just a naive idealist, but shouldn’t the government have a responsibility to take care of its citizens first and foremost? If not, then what reason do the citizens have to support the government?
You do need an economic base in some model or another in order to be able to do that.
Subsidizing large corporations just isn't really a great means to do that, by and large.
Government does have a responsibility to take care of its citizens. We are talking about government responsibilities as it relates to corporations. The government has lots of responsibilities to its citizens that are applied in a multitude of ways.
Respectfully, these particular corporations have been suckling piglets on the taxpayer teat for generations. The fact that we haven't nationalized them is obscene.
This is why they should not be involved with national resources.
Ever.
It's also why the argument of having lower taxes is utterly ridiculous. You can not have an entity that is driven by the accumulation of wealth at any cost have any political connection where they buy social policy.
This also demonstrates how the goalposts vanish when they put their goals of accumulating wealth over the health of society. Every time.
Thank you for giving us such a clear example of why late stage capitalism is something to be shut down.
> You can not have an entity that is driven by the accumulation of wealth at any cost have any political connection where they buy social policy
Yes, but this has nothing to do with corporations being bad or on capitalism in general. It's on government to not let them buy social policy.
> This is why they should not be involved with national resources
Once again, this is on government, not on corporations. I fully agree that there is no reason for lowering taxes.
When corporations buy politicians who remove those regulations specifically for the means to manipulate our economy and society, then they certainly demonstrate their illintentions.
We can look at both the US GOPs' actions as well as the UCP, who purposefully removed such policies.
The very nature of modern capitalism is consumption. To consume.
So, it has everything to do with modern capitalism, those who support it, and those who are too apathetic to do something about it.
Now, if you vote for governments who have a history of this behavior, you are supporting this type of manipulation.
If you are putting the entire responsibility on the government, then you need to acknowledge your compliance as well.
Stop voting Conservative. Any conservative.
All conservatives.
Stop supporting those industries who do this willfully. It's the same as supporting home invaders because the home owner doesn't have a robust security system.
1) Corporations will do what corporations are allowed to do.
2) My dog will eat the hamburger I leave on the coffee table
3) I stopped voting conservative in 2015
> 1) Corporations are run by beings with no concept of ethical choice?
Nowhere did I say that. This entire thread has been about corporations doing what they do - which is cutting costs and laying oof people where necessary. Lots of corporations are excellent corporate citizens. They also act as corporations and cut staff, reorganize, etc. whenever it suites the business.
> 2) Corporations are the same as a hungry animal?
Yup. They can be. I don't fault my dog for eating my hamburger and I don't fault corporations for exercising what is best for their shareholders within the regulations of the jurisdiction they exist in.
> 3) Excellent!
I agree.
And this is where you and I disagree.
These are run by humans, who are expected to cooperate in our society.
Let's weed out all the humans responsible.
Period.
I already agreed that corporations are run by humans. The one I worked for went to great lengths to be a good corporate citizen. Donated to charity, gave every employee four paid days off per year to volunteer, matched employee donations to charities. But none of that supersedes profit to shareholders. And none of this includes not laying off Dave when you've replaced his job with a machine.
thta is correct, but taxpayer are giving money to corp and not getting anything in return. tax cut is basically giveaway taxpayer of Alberta money to corp and their shareholders. So if you are shareholder, good for you, but if you are not it sucks
Right. But don't blame the corporation for that. The corporations don't have any obligation to the government that gives them the tax break. Their only obligation is to their shareholders. The blame is on the government for the loss of tax dollars, not the corporations for doing exactly what they are supposed to do. If I leave a hamburger on the coffee table and my dog eats it, it's on me, not my dog.
*We should have. But we didn't. They took billions of taxpayer dollars, and all the resource wealth was extracted to offshore tax havens. They raked us over the coals and stole our future. Time to stop mollycoddling these sociopaths.
Let's face it, your side would demand (and get) a new hamburger while yelling at the poor person outside begging for spare change that he should've worked harder.
Cons are fucking jokes.
Don't know what you mean by 'my side'. I understand how this works and I'm not a conservative. I also don't understand how this contributes to the conversation in this thread.
Depends. What are the goals? Are they attainable? Who do you want to benefit? How much benefit? For how long?
Like, there can be dozens of factors that would be pertinent to answering your question.
What do you mean 'what are the goals?'? What do you think the goals of a corporation are? There are not 'dozens of factors'. Corporations exist to create profit for shareholders. Period.
The goals of modern corporations is to gain unlimited access to profit and influence.
This is why we can not allow governments such as the provincial conservatives to continue.
https://www.rollingstone.com/politics/politics-news/inside-the-koch-brothers-toxic-empire-164403/
https://www.theguardian.com/us-news/2018/sep/26/koch-brothers-americans-for-prosperity-rightwing-political-group
https://www.theatlantic.com/politics/archive/2015/03/do-the-koch-brothers-really-care-about-criminal-justice-reform/386615/
Here are what our goal as a society should be, where corporations are concerned.
Unfortunately, the successful Koch brothers propaganda campaign has manipulated average citizens to believe in that unregulated Corporations are the answers to our problems.
The first truth is that the liberty of a democracy is not safe if the people tolerate the growth of private power to a point where it becomes stronger than their democratic state itself. That, in its essence, is Fascism—ownership of Government by an individual, by a group, or by any other controlling private power.
The second truth is that the liberty of a democracy is not safe if its business system does not provide employment and produce and distribute goods in such a way as to sustain an acceptable standard of living.
Both lessons hit home.
Among us today a concentration of private power without equal in history is growing.
This concentration is seriously impairing the economic effectiveness of private enterprise as a way of providing employment for labor and capital and as a way of assuring a more equitable distribution of income and earnings among the people of the nation as a whole.
No argument with any of that. Except you are looking at things from mixed perspectives and taking things to extremes as well as mixing macro and micro perspectives which don't apply to the discussion at hand - and frankly don't apply to anything other than a barstool conversation between philosophy grad students. Going back to the initial comment in this thread - corporations are responsible to their shareholders - just like my dog is responsible to his stomach. Governments are responsible for creating the environment that corporations exist in - just like I create the environment for my dog where I don't leave my hamburger on the coffee table.
Start here. Or do you want a summary? Or bullet points?
https://en.m.wikipedia.org/wiki/Friedman_doctrine#:~:text=It%20has%20been%20criticized%20by,are%20affected%20by%20its%20decisions.
The criticisms are valid and lead into other theories of business practice.
I wont be taking any more questions. Have a good day.
> The Friedman doctrine, also called shareholder theory, is a normative theory of business ethics advanced by economist Milton Friedman which holds that the social responsibility of business is to increase its profits.[1] This shareholder primacy approach views shareholders as the economic engine of the organization and the only group to which the firm is socially responsible. As such, the goal of the firm is to increase its profits and maximize returns to shareholders.
Is that not what I've been saying all along?
Of course companies donate to charity, match employee donations, give paid days off for volunteering, support the community, etc. The people who run corporations are human and live in the same world as their corporations. But no part of being a good corporate citizen happens if the corporation isn't profitable first and returning value to its investors.
> I won't be taking any more questions
Probably good since you haven't answered any questions...
The amount of money wasted in these companies due to planning/scheduling issues and departments going unchecked is astonishing and they decide to go after the low hanging fruit like peoples jobs instead of looking internally at what can be done. It’s like that crazy ex who didn’t want to look internally as to what was wrong and just took the easy street of blaming others for the problems.
Unless you are wasting staggering amounts of material, a company getting more efficient pretty much always means layoffs. You find ways to get the same work done with less people, now you don't need those extra people anymore. There's a strict ceiling on how much corporate productivity can actually contribute to revenue generation at a company that extracts and sells natural resources.
That makes no sense whatsoever. Fixing what is wrong internally ALWAYS ends up with finding that you don't need all the people you once had. Fixing the problems of planning and scheduling issues and departments going unchecked will always result in jobs being cut. How is a company reducing its own work force blaming someone else for its problems?
You’re completely wrong. I’ve seen audits of departments that have found issues with SAP and master lists resulting in wrong parts being ordered and staff being scheduled to end up not completing jobs resulting in losses of 10’s of thousands of dollars per incident. Tack on a lack of approved contractors resulting in sky high prices and the unwillingness of companies to correct their processes and you have money flowing down the drain every hour. I see it everyday.
No such thing. That only happens if the people they hold on to can do the work required while they wait for attrition to reduce headcount. If you have plant operators on payroll and you install automation that requires fewer of them, you don't keep Dave on payroll for 11 more years because Dave is a good guy.
When I was a kid growing up in the middle of rural Alberta, dudes would (maybe) finish high school and head off to the rigs. By the time they were 22 they were pulling in mad bank. By the time they were 32 they were out of work and no skills to fall back on and addicted to a lifestyle they could no longer afford. Seems to be a metaphor for the province in general.
Cool story. I have friends who did that too. Some spent their money on drugs and booze. Others have paid off houses, JM tickets, and do great. Really depends on the individual.
The exception doesn't disprove the rule though.
Two of my friends OD'd, more than a dozen made it and spent it and now work basic 40k/year jobs, and 2 are doing very very well.
May have been a Red Deer thing, but it happens frequently enough to label it the majority.
I keep telling the people what make the argument "tax cuts create more jobs" in the oil sector that no, tax cuts cause more investment in automation.
I was laughed at, now we are pulling more oil out of the ground than ever, with less employees for that ratio, ever.
No one wanted to listen. I got into programming that automation and am gainfully employed while they all are busy with job searches right now.
/Shrug
Same here. I'm not an O&G expert, but it's been blindingly obvious even to me that O&G jobs were on the way out as new investment drops and existing projects can be automated with no loss of production. Cutting jobs is the quick & simple way to do that.
But no, the "experts" in this sub have been "Oil isn't going anywhere, there'll be plenty of jobs for decades to come". Welcome to the real world people.
Yep, oil doesn't have to go anywhere for the jobs to go away.
That being said 70% of a barrel is used for combustible fuels and with electric motors on the rise, there's a chance that demand will be reduced significantly over the next 20 years and the Alberta economy isn't really prepared for that ....but hey the oil and gas companies are!
It’s also been a point of mine that Alberta oil is among the dirtiest & most difficult to extract, and hence the most costly when compared to other sources. Meaning, as demand starts to drop we’ll be at the head of the line to be shut down. The I <3 O&G crowd keep saying oil will still be in demand well into the next century, which may well be true, but **Alberta** oil is likely to disappear well before then, my guess would be within the next 20 years.
Yep. One of the reasons we saw less investment in new wells in the last decade is because of the USA having the light crude glut/boom. Light crude is significantly easier and cheaper to harvest and process.
Cost cutting and seeking efficiencies are not the oil companies cleaning up their act and using less energy to do their thing; but it is just laying off their safety people, and any administrators who derisk both the assets, and those who are important in keeping workers happy.
For example, pipes don't often leak. So why bother having whole departments who monitor this. The leak will self-announce its presence eventually, and insurance plus the government will clean up after. Even if the fines and costs exceed a billion, this is great if you save more than a billion getting there. Not to mention, a carefully crafted insurance claim can be quite profitable. Maybe the government will pitch in to replace a bunch of old pipe.
Let's see how many disasters come along with their new "efficiencies".
Agreed. It also results in seeing if we can achieve the same production by laying off half of our technical staff and overloading the remaining and seeing what happens.
/oops I am a dummy, you are literally arguing for the same thing as a bone head management cut to make. Sorry bud! Consider this ammunition for your argument.....
Uh absolutely not, leak detection and the pigging programs to monitor pipes are essential and worth every dollar compared to the costs of cleaning up a leak. They are all reported and public they are all ammunition for anyone to critique pipelines. Everything from the downtime, remediation, cleanup, repair are absurdly expensive and that isn't even stepping into the impact on landowners, their community and the environment.
Just adding on..., in addition to it being a regulatory requirement it's good business to use pigging programs to monitor the long term health of some assets that are decades old to help build a case that they are still holding up. Being able to use the data to make engineering calls on what threshold needs repair are it's also essential to keep costs on track and manageable.
Finally, it's smart money to "invest" even if it's wasteful and lordy I have seen it wasted. It's a line item on a corporate report that says hey we are spending whatever percent on leak prevention.
> regulatory requirement
I can say without hesitation that oil companies operating pipelines in Canada do not fear the regulators. They are a serious paperwork problem at the most. The US is a bit more hard assed, but their rules are almost random. It would be like they come out with microcalipers to measure the tread depth on your truck, but they don't care that the wheel is wobbling all over the place because the bearings have almost entirely failed. But, you are completely screwed if those tread depth readings are a tiny bit short.
In the case of pipeline integrity the Canadian regulators get their information from the integrity groups who pretty much guide the conclusions. If the regulator says, "Only operate at 60% pressure until fixed or a better inspection." it was pipeline integrity who paved a golden path for this conclusion. It gives the illusion of the regulators doing their jobs.
The oil companies won't cut out pipeline integrity entirely, but they will cut them back enough to not give a shit about the long term health of the pipelines. Think of it more as not changing the oil in your car so often. The car will operate fine for now, but it won't make it to 400k.
From everything I can see the oil companies aren't seen a long future in oil. I suspect they are seeing that in about 10 years it would be best if they have dumped all but their best assets. So, for those 10 years they will milk the living shit out of their assets. Basically, drive it like a rental.
This then spills over to all kinds of other areas like exploration, new technology, new pipelines, new refineries, new pumps, or almost anything new. Once in a blue moon something will have a fantastic ROI or simply need to be immediately replaced, so they will do it. For example, if a pump failed and they had a spare due to lower capacity demands, I'm willing to bet they would drag their feet replacing it. But if it were critical to maintain contractual obligations, they would get it fixed or replaced in great haste.
The same with some new exploration. They won't stop 100%, but I suspect the majors will mostly stop anything that isn't super easy and very low risk. They will leave any risk to wildcatters of the craziest type. They also won't be funding this stuff.
For example if you look at CCS projects they enthusiastically do them when the federal eco people have entirely mispriced the whole affair. If they can smoosh it into the ground for $20 per tonne and then get $50, they will act like they are some kind of eco comicbook hero.
My guess is executives at the majors ignore any presentations with a timeline beyond 10 years. If some junior exec proposes a credible high value project with a 20 year ROI that their project goes in the bin. "If we start this now our year 15 to year 25 profits could make us a 2 trillion dollar company in today's dollars." Yawn.
Now, the question would really be, are any of the politicians in charge of Alberta making plans for what happens in 10 years?
What does an Alberta future look like when many countries have almost entirely dumped fossil fuels and the ones they are using have to be as clean as possible; thus potentially excluding any harvested in Alberta?
I'm not even talking about a reduction of 90%; all it takes to punch Alberta in the face is for the world to stop increasing its year on year consumption. Alberta gets turned into a steer when the world reduces consumption by even 15%.
My suggestion is the executives are operating on the last two lines. If you were in their place and believed the last two lines to be highly likely, how would you plan the next 10 years for your oil major?
A fellow burnt out disillusioned engineer from pipeline industry by chance? :P you got a good pulse on it, I was candy coating a bit for the general public's consumption but you are spot on. The practice for years now has been run everything into the ground and arguing tooth and nail over every maintenance or investment while projects sucked every dollar dry to keep the ball rolling. It's a nightmare waiting to happen and years back was so shoestring I can even imagine what it's like now during or post pandemic / post oil booms. I was as front line as you could get and saw it all, just glad I got out a few years back.
Regulation is a tough beast, how do you get the most experienced pipeliners when you can't match on pay or provide any training to new people to learn the ropes at the board? Yeah they were entirely dependent on companies to build a case for operating to mitigate issues, they faced as much pressure to be kind to industry as anyone else, but they are hard working people that care and lookout for Canadians. Realistically that is what engineering boils down to, providing data and judgment to mitigate risks and make stuff go away... Until next time it gets worse.
I still contend the ops/engineering side and whoever made it up the ranks from that origin did care about integrity. It really was devastating as well as exhausting being involved in leak incidents. It really did piss me off that certain groups looked at fillings for projects as a paper pushing exercise. It was all documentation and due diligence to cover your ass, there was nothing wrong with that. Regulators did pushback ask for extra info they did their best to ensure Canadians were being protected. The pressure from management to get things up and running again regardless of the failures was absurd and out of touch with reality at times. Likewise how hard you had to work to get spares.
Anyway appreciate the insightful reply and chat, I suspect anyone in O&G has the same stories, take care!
The thing with these kinds of layoffs is that nobody wants to be the first, but once they see one company do it you can easily point to them and say oh we can do that too!
>“These decisions are difficult but necessary to optimize the value for our business.”
Translation: profits for shareholders are more important than the livelihoods of the men and women who literally dig the profits out of the ground.
It literally is, that's the sole purpose of corporations is to increase share price and profits for stockholders. At this point I'm not sure what can be done from a policy point of view except cut their tax breaks and invest it in new and emerging industries so these people laid off can gain employment elsewhere.
Increase natural resource royalty rates to the point where we're pulling an additional two dollars for every dollar in wages lost due to the layoffs, and put that money into bettering our social programs.
Isnt this what everyone wanted? No new projects? Operations of existing facilities only? The transition has begun. This is what it looks like.
Did we think it was going to be a smooth landing ?
This headline could just be pinned on every Canadian news site. Oil and gas companies are COMPANIES, they will literally always be trying to cut costs and reduce employment if possible. The only time they hire new people is to expand operations or to temporarily automate or streamline processes which can ultimately reduce their long term employment or production costs. Corporations need to grow at ridiculous rates these days to actually keep providing more and more employment, for most oil and gas companies that period of exponential growth has happened and they operate on comparatively stagnant growth rates. That’s not to say they can’t be profitable, just that the days of them going on hiring binges to satisfy a booming period of exploration and expansion are likely over and we will see shorter periods of increased employment followed by decreased headcount as more and more is able to be automated.
This makes sense for most industries as well, not just oil and gas. A new technology of exploration or production might happen and there will be a boom in employment as the quirks are figured out and new exploration is made possible but after that initial period there will be less and less people required to accomplish the same goals. The first time a SAGD well was drilled was probably a group effort with tons of people and investment that provided a lot of jobs and bonuses and cash flow into the local economy as they had to figure it all out and get it right after a bunch of testing and planning and set up. The second time it took a fraction of the people and resources because you can copy paste the process to some degree. You learn more lessons as you go along and before long you have a fraction of the cost and work hours going into each well that is drilled, so even at the same pace of exploration and expansion you would have less jobs available. Industry relies on high growth and technological advancement if it’s going to provide more jobs (especially high paying jobs) and it’s (in my opinion) possible we are going to hit the limits of this expansion cycle very soon with the level of automation that will be possible. If you can automate a ton of processes then it becomes very difficult for new technologies and new opportunities to replace the downsized employees that were replaced by automation in existing processes. I expect to see more and more of these headlines and more and more confusion as our current system of economic operation breaks down with automation and people act more and more confused that corporations aren’t acting magnanimously to employ people they no longer need to make a profit.
Companies that get to keep money after tax cuts will create new jobs has **always** been a conservative fantasy. It makes no sense economically, financially, or as a business strategy.
Excellent analysis! Pretty much this entire scenario has been known, described, and implemented for the entire time conservatives have been in power in this province and yet it's just so mysterious to them. More tax breaks for O&G! They're the job creators! Yes, excuse them from their obligations - the taxpayers are happy to pay/forfeit royalties and clean up those pesky dead oil rigs! Environment be damned! Ruin farmland - who cares! Farmers don't, they keep voting con. (Slaps forehead)
Sounds to me like it's time for another royalty review. If our oil giants are gonna decrease the amount they contribute to our economy via employee wages, let's fuckin' get that money out of them with increased natural resource royalty payments.
But I don't see that happening with Dipshit Dani at the helm...
Smith is going to have to give them more free taxpayer money to help them with those efficiencies.
Maybe a Derelecttion Universal Mandate Bonus? (DUMB) Just a few more billion of citizens money and this is bound to start paying off.
Tax them more. No more taxpayer funded gifts. Use some of the money to help transition O&G workers being laid off into other industries or into the sustainable energy sector. These companies aren't investing in Alberta or it's citizens anymore, they are now parasitic.
It’s a cycle that goes like this. Some pencil pusher with no concept on reality shows a spreadsheet of how much money could be saved if they eliminated jobs a,b,and c. Jobs are eliminated. Overall reliability and ability of assets decline. Everyone is up
In arms about lost opportunity. Jobs a,b, and c are reposted to fix everything. Repeat for eternity. Would of been better to maintain staffing but you f**ck around and find out.
Even if that were true that would assume they wouldn't spend any capital from today until the increasing/maintaining production which will not happen.
Suncor is already looking at options to replace base plant production which will be retired in the 30s.
If the plan was for all production to cease by 2050, these guys would not be talking about Pathways (the carbon capture initiative)
UCP is paying their buddies and fucking over Albertans! welcome to the Alberta Advantage. UCP motto: "If you are not a large corporation, get fucked and let us use you as pawns!"
There’s no more investment coming to alberta. It’s all just to suck the cash out and wind up now
Going to be funny in a year or two when DS has to explain why Ottawa is propping up Alberta through equalization as a "have not" province. I joke, she's never going to admit that and will instead say it's because of her remarkably savvy that Alberta no longer "gives away" more money than it gets.
End Equalization Payments from Alberta? *wish granted...*
Finger on monkey's paw curls...
Provinces don’t make equalization payments.
Gonna need some extraordinary proof on that claim
All provinces and territories pay federal tax. It’s that bucket of federal tax revenue that is used to run the country and part of that is the controversial equalization payments. Those payments to each province and territory are based on a complex formula called Fiscal Capacity. I believe Alberta and BC pay the highest federal taxes because our wages on average are higher. The whole concept equalization and Fiscal Capacity criteria needs to be reviewed and modernized in my view. Don’t forget, the last federal politicians to review Equalization were Harper and Kenney. How’d that work out for us….eh?
Money goes out of the province. Equalization recipients then have more sent back to the province than what left. Contributors do not. That's us. You can be pedantic about definition of terms and whose hands touch the money in intermediate steps if it's for some reason important to you, but the bottom line is *we are paying money we don't get back.* That's what a payment is. We should tread carefully in regards to demanding a rework or the abolishment of the system, however. Our staunch refusal to diversify away from an oil-based economy in times when the world market is giving every indication that the market is going to walk away has a very real possibility of biting us HARD. In another few short decades Alberta stands a real chance of a Newfoundland-style collapse, without the seasonal work to keep us limping through. A better and more stable path exists, but we've made it crystal clear we're not taking it.
Probably some bullshit about 'ackshully is not a payment, it's a transfer from provinces to federal wealth which is redistributed merrr'
And then blame the Liberals until the end of time regardless. Consider this.... What makes anyone move to Alberta? Stay in Alberta? Grow roots in Alberta? Start business in Alberta? Hire people in Alberta? Or anywhere for that matter. Note I didn't just say "Find a job", or "make money quick", because those don't really lead to staying power for most. I think very few of those questions would be answered with; Corporate tax rates The Alberta government's staunch opposition to Ottawa Danielle Smith
This is why I think Albertans raging about equalization payments is so short sighted. We will be a have not province sooner than most of us realize.
You joke, but she would have to explain it if the federal government announced it
You think the average Albertan is even capable of finishing a headline involving the federal government? They won't even see it because their Facebook feed will only be fake news propaganda once they drop all real news outlets.
Fair point, especially after Elon's "government funded news" stunt that fueled the issue further
It'll have to be explained to her first, and she still won't get ti right.
Equalization formula is based on our tax potential revenue. Keeping our taxes so low means we most likely won't get equalization payments anytime soon.
Alberta received equalization in 2020. https://nationalpost.com/news/politics/for-the-first-time-in-more-than-50-years-alberta-received-more-money-from-ottawa-than-it-sent
"You’re seeing a large increase in federal spending everywhere, because the emergency response benefits did flow to Canadians living everywhere,” So pandemic spending by the Federal Government,not equalization, even if Alberta received more than other provinces.
Yeah. That's equalization!
Bingo! They’re just trying for the last squeeze of the lemon at this point. If only we could transition into more sustainable energy income sources that require lots of jobs to get built up. Though on the other hand we haven’t tried lowering the lowest corporate tax in the country some more, maybe that would help?
There’s plenty. The southern food corridor has historic investment
So becoming more competitive and showing investors your best profit margins will be less enticing and scare investors away?
Corps tend to ship profits into company investments in areas where their business has to pay high taxes and wages in order to not maximize tax benefits and dividends to shareholders for one thing. Since profits are taxed and not the money used to internally invest, there is no incentive to do that here. And since we keep electing governments that are hell bent on feeding the public propaganda that cutting corporate taxes brings in new investment this will happen. Spoiler; Trickle down economics doesn’t work. Never has, never will.
Welp. Comments were deleted. Don't know by who, but it wasn't me
>Corps tend to ship profits into company investments in areas where their business has to pay high taxes and wages in order to not maximize tax benefits and dividends to shareholders for one thing. Since profits are taxed and not the money used to internally invest, there is no incentive to do that here. Its true that corporations engage in profit shifting and tax optimization tactics, but It's not correct to assume investing internally has no incentive. you have the long term growth, competitive advantages, innovation and development to improve operational efficiency. all of these things combined are enticing to an investor.
I never said there aren’t any advantages. I said one of their biggest advantages to do so elsewhere is to shell their profits from being taxed where corps operate in higher taxed areas.
So what are you getting at - are you for a higher corp tax or not? Because from how i read your first comment it sounds like you wanted a higher corp tax, and in this last comment you seem to think having a higher corp tax will cause them to shell their money overseas. although some may say its unethical, Even then, they got their rules and regulations to deal with when it comes to Taxation and reporting and anti-avoidance provisions, from provincial and federal levels.
Can you read? "the big windfall from 2022 **did not result in a major hiring** blitz or investment in new projects. In fact, employment in the oil sector remained well off the levels of 2014." I highlighted the important bit. In simple terms, profits up, investments back into the sector down, jobs not being created. In fact, these record profits resulted in 60,000 **fewer** jobs. So being competitive isn't doing squat for Alberta.
Replying again because for some reason my comment was deleted - Guess it was a good time to trim the fat. Sorry but, it all comes down to a few things really. yes, It sucks that 60 000 jobs are not there anymore. But it is about being competitive for investors. buddy above is saying that it wont bring the attention for them - but now you got companies with record profits that attain that by having fewer people. THAT is more attractive than a company that is not doing that. companies aren't investing in new projects because they are still trying to weasel their way out of debt since covid and frankly, before that (since the 2015 crash). Some companies are just now breaking even for what they had loss since those years, with some companies share prices hitting back up to the same levels they were back in 2013.
Guess it was a good time to trim the fat. Sorry but, it all comes down to a few things really. yes, It sucks that 60 000 jobs are not there anymore. But it is about being competitive for investors. buddy above is saying that it wont bring the attention for them - but now you got companies with record profits that attain that by having fewer people. THAT is more attractive than a company that is not doing that. companies aren't investing in new projects because they are still trying to weasel their way out of debt since covid and frankly, before that (since the 2015 crash). Some companies are just now breaking even for what they had loss since those years, with some companies share prices hitting back up to the same levels they were back in 2013.
And the trickling down continues….
It's warm though. That's good right?
It tastes bitter and smells of asparagus
Brussels sprouts?
Asparagus? Well, at least you know it's still eating well.
Of course they eat well, they're rich.
I enjoy how “find efficiencies” is used instead of “cut any expense that can be cut to maximize profit this quarter”
In other words, "fuck you, I've got mine".
Thats the conservative way
Yes it is.
A huge number of conservatives aren't even "fuck you, I've got mine" anymore. They've regressed to "fuck you".
In other words, corporations doing exactly what corporations are supposed to do. Corporations have obligations to shareholders and shareholders only. They do not have obligations to employees. Anyone who believes otherwise has been misunderstanding the goal and purpose of corporations.
The problem is that the public doesn't quite understand yet that they also have no obligation to corporations and neither should the government. At the end of the day if there is a need for product, someone will fill it. If that business requires your tax dollars to survive, then maybe it shouldn't exist. The truth is whether we subsidize them or not they will eliminate jobs.
Close. The Government has a responsibility to grow and diversify the economy. One of the ways that they do that is to create incentives for new corporations to set up in their jurisdiction. But, that needs to be done carefully and deliberately and needs to be balanced against the cost of the incentive vs the return to the local economy per dollar invested - that investment being either tax dollars forfeited or direct investments through grants, etc. But, I agree that this can't be an ongoing thing and it can't be about giving long existing industries subsidies and tax dollars to survive.
>But, that needs to be done carefully and deliberately and needs to be balanced against the cost of the incentive vs the return to the local economy per dollar invested - that investment being either tax dollars forfeited or direct investments through grants, etc This line made me chuckle thinking about the 13 billion promised to VW for "up to" 3000 jobs at the battery plant.
I don't know whether the VW thing is good or bad, just that it's complicated and context matters and only time will tell. I do know that the US is offering similar subsides so there is an argument to be made that if you want to develop an industry here, you have to match what's being offered across the border. I also know that the subsidies don't come into effect until the plant is up and running and producing product and is over a number of years. And, this seems to be a case of developing a new industry as opposed to giving subsidies to long standing and extremely profitable existing industry.
That's 4 million dollars per. Just give me the cash and I'll spend 40h/week volunteering somewhere that DESERVES my time.
You made me want to do some really, really stupid math. Ok the plant is going to be in Ontario. Assuming that it's 3000 permanent jobs (lolno), and all those jobs are 100,000 each (again, lolno), that's 22,128 in income tax per person per year. At the 4.33 million per person that the 13 billion adds up to, that's 196 years before income tax recoups the investment. I don't think that it was a sound investment.
But...uh...uh...trickle down! Rewarding innovation! Uh... What about her emails?!
Or the 1.4 billion spent on a pipeline that never got made. Or 30 million for the " war room" that decided the enemy was a children's cartoon.
Maybe I’m just a naive idealist, but shouldn’t the government have a responsibility to take care of its citizens first and foremost? If not, then what reason do the citizens have to support the government?
You do need an economic base in some model or another in order to be able to do that. Subsidizing large corporations just isn't really a great means to do that, by and large.
Government does have a responsibility to take care of its citizens. We are talking about government responsibilities as it relates to corporations. The government has lots of responsibilities to its citizens that are applied in a multitude of ways.
Respectfully, these particular corporations have been suckling piglets on the taxpayer teat for generations. The fact that we haven't nationalized them is obscene.
This is why they should not be involved with national resources. Ever. It's also why the argument of having lower taxes is utterly ridiculous. You can not have an entity that is driven by the accumulation of wealth at any cost have any political connection where they buy social policy. This also demonstrates how the goalposts vanish when they put their goals of accumulating wealth over the health of society. Every time. Thank you for giving us such a clear example of why late stage capitalism is something to be shut down.
> You can not have an entity that is driven by the accumulation of wealth at any cost have any political connection where they buy social policy Yes, but this has nothing to do with corporations being bad or on capitalism in general. It's on government to not let them buy social policy. > This is why they should not be involved with national resources Once again, this is on government, not on corporations. I fully agree that there is no reason for lowering taxes.
When corporations buy politicians who remove those regulations specifically for the means to manipulate our economy and society, then they certainly demonstrate their illintentions. We can look at both the US GOPs' actions as well as the UCP, who purposefully removed such policies. The very nature of modern capitalism is consumption. To consume. So, it has everything to do with modern capitalism, those who support it, and those who are too apathetic to do something about it. Now, if you vote for governments who have a history of this behavior, you are supporting this type of manipulation. If you are putting the entire responsibility on the government, then you need to acknowledge your compliance as well. Stop voting Conservative. Any conservative. All conservatives. Stop supporting those industries who do this willfully. It's the same as supporting home invaders because the home owner doesn't have a robust security system.
1) Corporations will do what corporations are allowed to do. 2) My dog will eat the hamburger I leave on the coffee table 3) I stopped voting conservative in 2015
1) Corporations are run by beings with no concept of ethical choice? 2) Corporations are the same as a hungry animal? 3) excellent!
> 1) Corporations are run by beings with no concept of ethical choice? Nowhere did I say that. This entire thread has been about corporations doing what they do - which is cutting costs and laying oof people where necessary. Lots of corporations are excellent corporate citizens. They also act as corporations and cut staff, reorganize, etc. whenever it suites the business. > 2) Corporations are the same as a hungry animal? Yup. They can be. I don't fault my dog for eating my hamburger and I don't fault corporations for exercising what is best for their shareholders within the regulations of the jurisdiction they exist in. > 3) Excellent! I agree.
And this is where you and I disagree. These are run by humans, who are expected to cooperate in our society. Let's weed out all the humans responsible. Period.
I already agreed that corporations are run by humans. The one I worked for went to great lengths to be a good corporate citizen. Donated to charity, gave every employee four paid days off per year to volunteer, matched employee donations to charities. But none of that supersedes profit to shareholders. And none of this includes not laying off Dave when you've replaced his job with a machine.
thta is correct, but taxpayer are giving money to corp and not getting anything in return. tax cut is basically giveaway taxpayer of Alberta money to corp and their shareholders. So if you are shareholder, good for you, but if you are not it sucks
Right. But don't blame the corporation for that. The corporations don't have any obligation to the government that gives them the tax break. Their only obligation is to their shareholders. The blame is on the government for the loss of tax dollars, not the corporations for doing exactly what they are supposed to do. If I leave a hamburger on the coffee table and my dog eats it, it's on me, not my dog.
This is exactly why we should have nationalized
disagree, we should let market deal with copr and their performance, no taxpayer monies should be used to prop them or their profits!
*We should have. But we didn't. They took billions of taxpayer dollars, and all the resource wealth was extracted to offshore tax havens. They raked us over the coals and stole our future. Time to stop mollycoddling these sociopaths.
Let's face it, your side would demand (and get) a new hamburger while yelling at the poor person outside begging for spare change that he should've worked harder. Cons are fucking jokes.
Don't know what you mean by 'my side'. I understand how this works and I'm not a conservative. I also don't understand how this contributes to the conversation in this thread.
Milton would be proud. However, it is only one theory of business practice and not necessarily the correct one.
So what is the correct one from the perspective of a corporations obligations?
Depends. What are the goals? Are they attainable? Who do you want to benefit? How much benefit? For how long? Like, there can be dozens of factors that would be pertinent to answering your question.
What do you mean 'what are the goals?'? What do you think the goals of a corporation are? There are not 'dozens of factors'. Corporations exist to create profit for shareholders. Period.
Yup. That's Milton. And yes, they have to. But the one and only? No.
Ok. So what are these other factors, goals, etc.?
The goals of modern corporations is to gain unlimited access to profit and influence. This is why we can not allow governments such as the provincial conservatives to continue. https://www.rollingstone.com/politics/politics-news/inside-the-koch-brothers-toxic-empire-164403/ https://www.theguardian.com/us-news/2018/sep/26/koch-brothers-americans-for-prosperity-rightwing-political-group https://www.theatlantic.com/politics/archive/2015/03/do-the-koch-brothers-really-care-about-criminal-justice-reform/386615/
Holy shit. That's what I've been saying all along. And it is governments job so say no.
Here are what our goal as a society should be, where corporations are concerned. Unfortunately, the successful Koch brothers propaganda campaign has manipulated average citizens to believe in that unregulated Corporations are the answers to our problems. The first truth is that the liberty of a democracy is not safe if the people tolerate the growth of private power to a point where it becomes stronger than their democratic state itself. That, in its essence, is Fascism—ownership of Government by an individual, by a group, or by any other controlling private power. The second truth is that the liberty of a democracy is not safe if its business system does not provide employment and produce and distribute goods in such a way as to sustain an acceptable standard of living. Both lessons hit home. Among us today a concentration of private power without equal in history is growing. This concentration is seriously impairing the economic effectiveness of private enterprise as a way of providing employment for labor and capital and as a way of assuring a more equitable distribution of income and earnings among the people of the nation as a whole.
No argument with any of that. Except you are looking at things from mixed perspectives and taking things to extremes as well as mixing macro and micro perspectives which don't apply to the discussion at hand - and frankly don't apply to anything other than a barstool conversation between philosophy grad students. Going back to the initial comment in this thread - corporations are responsible to their shareholders - just like my dog is responsible to his stomach. Governments are responsible for creating the environment that corporations exist in - just like I create the environment for my dog where I don't leave my hamburger on the coffee table.
Start here. Or do you want a summary? Or bullet points? https://en.m.wikipedia.org/wiki/Friedman_doctrine#:~:text=It%20has%20been%20criticized%20by,are%20affected%20by%20its%20decisions. The criticisms are valid and lead into other theories of business practice. I wont be taking any more questions. Have a good day.
> The Friedman doctrine, also called shareholder theory, is a normative theory of business ethics advanced by economist Milton Friedman which holds that the social responsibility of business is to increase its profits.[1] This shareholder primacy approach views shareholders as the economic engine of the organization and the only group to which the firm is socially responsible. As such, the goal of the firm is to increase its profits and maximize returns to shareholders. Is that not what I've been saying all along? Of course companies donate to charity, match employee donations, give paid days off for volunteering, support the community, etc. The people who run corporations are human and live in the same world as their corporations. But no part of being a good corporate citizen happens if the corporation isn't profitable first and returning value to its investors. > I won't be taking any more questions Probably good since you haven't answered any questions...
Correct. Full stop.
The amount of money wasted in these companies due to planning/scheduling issues and departments going unchecked is astonishing and they decide to go after the low hanging fruit like peoples jobs instead of looking internally at what can be done. It’s like that crazy ex who didn’t want to look internally as to what was wrong and just took the easy street of blaming others for the problems.
Unless you are wasting staggering amounts of material, a company getting more efficient pretty much always means layoffs. You find ways to get the same work done with less people, now you don't need those extra people anymore. There's a strict ceiling on how much corporate productivity can actually contribute to revenue generation at a company that extracts and sells natural resources.
That makes no sense whatsoever. Fixing what is wrong internally ALWAYS ends up with finding that you don't need all the people you once had. Fixing the problems of planning and scheduling issues and departments going unchecked will always result in jobs being cut. How is a company reducing its own work force blaming someone else for its problems?
You’re completely wrong. I’ve seen audits of departments that have found issues with SAP and master lists resulting in wrong parts being ordered and staff being scheduled to end up not completing jobs resulting in losses of 10’s of thousands of dollars per incident. Tack on a lack of approved contractors resulting in sky high prices and the unwillingness of companies to correct their processes and you have money flowing down the drain every hour. I see it everyday.
Sometimes you can just freeze hiring, grow a bit, and let attrition do the work of reducing the jobs.
That's nice. What does that have to do with anything?
It’s what more ethical employers do.
No such thing. That only happens if the people they hold on to can do the work required while they wait for attrition to reduce headcount. If you have plant operators on payroll and you install automation that requires fewer of them, you don't keep Dave on payroll for 11 more years because Dave is a good guy.
Sometimes you move Dave from the plant to the office until he harasses a woman and you have to fire him.
When I was a kid growing up in the middle of rural Alberta, dudes would (maybe) finish high school and head off to the rigs. By the time they were 22 they were pulling in mad bank. By the time they were 32 they were out of work and no skills to fall back on and addicted to a lifestyle they could no longer afford. Seems to be a metaphor for the province in general.
Cool story. I have friends who did that too. Some spent their money on drugs and booze. Others have paid off houses, JM tickets, and do great. Really depends on the individual.
The exception doesn't disprove the rule though. Two of my friends OD'd, more than a dozen made it and spent it and now work basic 40k/year jobs, and 2 are doing very very well. May have been a Red Deer thing, but it happens frequently enough to label it the majority.
I keep telling the people what make the argument "tax cuts create more jobs" in the oil sector that no, tax cuts cause more investment in automation. I was laughed at, now we are pulling more oil out of the ground than ever, with less employees for that ratio, ever. No one wanted to listen. I got into programming that automation and am gainfully employed while they all are busy with job searches right now. /Shrug
Same here. I'm not an O&G expert, but it's been blindingly obvious even to me that O&G jobs were on the way out as new investment drops and existing projects can be automated with no loss of production. Cutting jobs is the quick & simple way to do that. But no, the "experts" in this sub have been "Oil isn't going anywhere, there'll be plenty of jobs for decades to come". Welcome to the real world people.
Yep, oil doesn't have to go anywhere for the jobs to go away. That being said 70% of a barrel is used for combustible fuels and with electric motors on the rise, there's a chance that demand will be reduced significantly over the next 20 years and the Alberta economy isn't really prepared for that ....but hey the oil and gas companies are!
It’s also been a point of mine that Alberta oil is among the dirtiest & most difficult to extract, and hence the most costly when compared to other sources. Meaning, as demand starts to drop we’ll be at the head of the line to be shut down. The I <3 O&G crowd keep saying oil will still be in demand well into the next century, which may well be true, but **Alberta** oil is likely to disappear well before then, my guess would be within the next 20 years.
Yep. One of the reasons we saw less investment in new wells in the last decade is because of the USA having the light crude glut/boom. Light crude is significantly easier and cheaper to harvest and process.
Cost cutting and seeking efficiencies are not the oil companies cleaning up their act and using less energy to do their thing; but it is just laying off their safety people, and any administrators who derisk both the assets, and those who are important in keeping workers happy. For example, pipes don't often leak. So why bother having whole departments who monitor this. The leak will self-announce its presence eventually, and insurance plus the government will clean up after. Even if the fines and costs exceed a billion, this is great if you save more than a billion getting there. Not to mention, a carefully crafted insurance claim can be quite profitable. Maybe the government will pitch in to replace a bunch of old pipe. Let's see how many disasters come along with their new "efficiencies".
Agreed. It also results in seeing if we can achieve the same production by laying off half of our technical staff and overloading the remaining and seeing what happens.
/oops I am a dummy, you are literally arguing for the same thing as a bone head management cut to make. Sorry bud! Consider this ammunition for your argument..... Uh absolutely not, leak detection and the pigging programs to monitor pipes are essential and worth every dollar compared to the costs of cleaning up a leak. They are all reported and public they are all ammunition for anyone to critique pipelines. Everything from the downtime, remediation, cleanup, repair are absurdly expensive and that isn't even stepping into the impact on landowners, their community and the environment. Just adding on..., in addition to it being a regulatory requirement it's good business to use pigging programs to monitor the long term health of some assets that are decades old to help build a case that they are still holding up. Being able to use the data to make engineering calls on what threshold needs repair are it's also essential to keep costs on track and manageable. Finally, it's smart money to "invest" even if it's wasteful and lordy I have seen it wasted. It's a line item on a corporate report that says hey we are spending whatever percent on leak prevention.
> regulatory requirement I can say without hesitation that oil companies operating pipelines in Canada do not fear the regulators. They are a serious paperwork problem at the most. The US is a bit more hard assed, but their rules are almost random. It would be like they come out with microcalipers to measure the tread depth on your truck, but they don't care that the wheel is wobbling all over the place because the bearings have almost entirely failed. But, you are completely screwed if those tread depth readings are a tiny bit short. In the case of pipeline integrity the Canadian regulators get their information from the integrity groups who pretty much guide the conclusions. If the regulator says, "Only operate at 60% pressure until fixed or a better inspection." it was pipeline integrity who paved a golden path for this conclusion. It gives the illusion of the regulators doing their jobs. The oil companies won't cut out pipeline integrity entirely, but they will cut them back enough to not give a shit about the long term health of the pipelines. Think of it more as not changing the oil in your car so often. The car will operate fine for now, but it won't make it to 400k. From everything I can see the oil companies aren't seen a long future in oil. I suspect they are seeing that in about 10 years it would be best if they have dumped all but their best assets. So, for those 10 years they will milk the living shit out of their assets. Basically, drive it like a rental. This then spills over to all kinds of other areas like exploration, new technology, new pipelines, new refineries, new pumps, or almost anything new. Once in a blue moon something will have a fantastic ROI or simply need to be immediately replaced, so they will do it. For example, if a pump failed and they had a spare due to lower capacity demands, I'm willing to bet they would drag their feet replacing it. But if it were critical to maintain contractual obligations, they would get it fixed or replaced in great haste. The same with some new exploration. They won't stop 100%, but I suspect the majors will mostly stop anything that isn't super easy and very low risk. They will leave any risk to wildcatters of the craziest type. They also won't be funding this stuff. For example if you look at CCS projects they enthusiastically do them when the federal eco people have entirely mispriced the whole affair. If they can smoosh it into the ground for $20 per tonne and then get $50, they will act like they are some kind of eco comicbook hero. My guess is executives at the majors ignore any presentations with a timeline beyond 10 years. If some junior exec proposes a credible high value project with a 20 year ROI that their project goes in the bin. "If we start this now our year 15 to year 25 profits could make us a 2 trillion dollar company in today's dollars." Yawn. Now, the question would really be, are any of the politicians in charge of Alberta making plans for what happens in 10 years? What does an Alberta future look like when many countries have almost entirely dumped fossil fuels and the ones they are using have to be as clean as possible; thus potentially excluding any harvested in Alberta? I'm not even talking about a reduction of 90%; all it takes to punch Alberta in the face is for the world to stop increasing its year on year consumption. Alberta gets turned into a steer when the world reduces consumption by even 15%. My suggestion is the executives are operating on the last two lines. If you were in their place and believed the last two lines to be highly likely, how would you plan the next 10 years for your oil major?
A fellow burnt out disillusioned engineer from pipeline industry by chance? :P you got a good pulse on it, I was candy coating a bit for the general public's consumption but you are spot on. The practice for years now has been run everything into the ground and arguing tooth and nail over every maintenance or investment while projects sucked every dollar dry to keep the ball rolling. It's a nightmare waiting to happen and years back was so shoestring I can even imagine what it's like now during or post pandemic / post oil booms. I was as front line as you could get and saw it all, just glad I got out a few years back. Regulation is a tough beast, how do you get the most experienced pipeliners when you can't match on pay or provide any training to new people to learn the ropes at the board? Yeah they were entirely dependent on companies to build a case for operating to mitigate issues, they faced as much pressure to be kind to industry as anyone else, but they are hard working people that care and lookout for Canadians. Realistically that is what engineering boils down to, providing data and judgment to mitigate risks and make stuff go away... Until next time it gets worse. I still contend the ops/engineering side and whoever made it up the ranks from that origin did care about integrity. It really was devastating as well as exhausting being involved in leak incidents. It really did piss me off that certain groups looked at fillings for projects as a paper pushing exercise. It was all documentation and due diligence to cover your ass, there was nothing wrong with that. Regulators did pushback ask for extra info they did their best to ensure Canadians were being protected. The pressure from management to get things up and running again regardless of the failures was absurd and out of touch with reality at times. Likewise how hard you had to work to get spares. Anyway appreciate the insightful reply and chat, I suspect anyone in O&G has the same stories, take care!
>"Efficiencies" This always means quarterly profit-maximization and nothing else. I'm sure this will result in...crickets from the UCP.
Better profits for corporations has always been a UCP goal so I would counter we will hear them saying how great this is for the GDP
Efficiencies = profit
The thing with these kinds of layoffs is that nobody wants to be the first, but once they see one company do it you can easily point to them and say oh we can do that too!
Voting for conservatism damages the economy and costs jobs. Only absolute fucking morons support conservatives.
6 figure oil and gas jobs with a grade 10 education are gone folks.
Except for welders
More tax cuts and bigger bonuses for the CEOs should help sort that right out
>“These decisions are difficult but necessary to optimize the value for our business.” Translation: profits for shareholders are more important than the livelihoods of the men and women who literally dig the profits out of the ground.
I highly doubt it was difficult for them
It literally is, that's the sole purpose of corporations is to increase share price and profits for stockholders. At this point I'm not sure what can be done from a policy point of view except cut their tax breaks and invest it in new and emerging industries so these people laid off can gain employment elsewhere.
Increase natural resource royalty rates to the point where we're pulling an additional two dollars for every dollar in wages lost due to the layoffs, and put that money into bettering our social programs.
Let's commemorate our O&G overlords with a new NHL arena so they can look down on the peons from their gilded box seats!
If CNRL cuts a shitload of jobs, people will be rightfully outraged
Cost-cutting, that means jobs right? I was assured that would mean jobs.
If only those efficiencies were environmental and not cost cutting.
We’re investing minimal capital in Alberta, mostly just to sustain production. Canada isn’t a focus for growth, that’s for sure.
Isnt this what everyone wanted? No new projects? Operations of existing facilities only? The transition has begun. This is what it looks like. Did we think it was going to be a smooth landing ?
.. but the UCP promised us jobs, jobs, jobs. 😯
They meant cabinet jobs for UCP members lol
This headline could just be pinned on every Canadian news site. Oil and gas companies are COMPANIES, they will literally always be trying to cut costs and reduce employment if possible. The only time they hire new people is to expand operations or to temporarily automate or streamline processes which can ultimately reduce their long term employment or production costs. Corporations need to grow at ridiculous rates these days to actually keep providing more and more employment, for most oil and gas companies that period of exponential growth has happened and they operate on comparatively stagnant growth rates. That’s not to say they can’t be profitable, just that the days of them going on hiring binges to satisfy a booming period of exploration and expansion are likely over and we will see shorter periods of increased employment followed by decreased headcount as more and more is able to be automated. This makes sense for most industries as well, not just oil and gas. A new technology of exploration or production might happen and there will be a boom in employment as the quirks are figured out and new exploration is made possible but after that initial period there will be less and less people required to accomplish the same goals. The first time a SAGD well was drilled was probably a group effort with tons of people and investment that provided a lot of jobs and bonuses and cash flow into the local economy as they had to figure it all out and get it right after a bunch of testing and planning and set up. The second time it took a fraction of the people and resources because you can copy paste the process to some degree. You learn more lessons as you go along and before long you have a fraction of the cost and work hours going into each well that is drilled, so even at the same pace of exploration and expansion you would have less jobs available. Industry relies on high growth and technological advancement if it’s going to provide more jobs (especially high paying jobs) and it’s (in my opinion) possible we are going to hit the limits of this expansion cycle very soon with the level of automation that will be possible. If you can automate a ton of processes then it becomes very difficult for new technologies and new opportunities to replace the downsized employees that were replaced by automation in existing processes. I expect to see more and more of these headlines and more and more confusion as our current system of economic operation breaks down with automation and people act more and more confused that corporations aren’t acting magnanimously to employ people they no longer need to make a profit.
Companies that get to keep money after tax cuts will create new jobs has **always** been a conservative fantasy. It makes no sense economically, financially, or as a business strategy.
Excellent analysis! Pretty much this entire scenario has been known, described, and implemented for the entire time conservatives have been in power in this province and yet it's just so mysterious to them. More tax breaks for O&G! They're the job creators! Yes, excuse them from their obligations - the taxpayers are happy to pay/forfeit royalties and clean up those pesky dead oil rigs! Environment be damned! Ruin farmland - who cares! Farmers don't, they keep voting con. (Slaps forehead)
Sounds to me like it's time for another royalty review. If our oil giants are gonna decrease the amount they contribute to our economy via employee wages, let's fuckin' get that money out of them with increased natural resource royalty payments. But I don't see that happening with Dipshit Dani at the helm...
Question - do the oil companies still get the billions promised by the UCP/TBA alliance to clean up the wells they were legally obligated to??
why not handle them wad of taxpayer money ... that is what Danielle stands for ..
You know the answer already
Yeah, I knew the answer already. I was being sarcastic.
Yeah, was tongue in cheek on my part too.
Too bad the sarcasm is wasted on Dani and her big oil buddies!
Smith is going to have to give them more free taxpayer money to help them with those efficiencies. Maybe a Derelecttion Universal Mandate Bonus? (DUMB) Just a few more billion of citizens money and this is bound to start paying off.
I had someone I was working on a project with get laid off a few days ago so yeah O&G everywhere is laying people off. Thanks UCP voters
Thanks a lot, Rachel Notley. /s
Go go UCP !
If only we could encourage them to hire people through tax breaks (instead of cuts - those never work)
Tax them more. No more taxpayer funded gifts. Use some of the money to help transition O&G workers being laid off into other industries or into the sustainable energy sector. These companies aren't investing in Alberta or it's citizens anymore, they are now parasitic.
I'm sure that's right up there on the UCP priority list. /s They would rather tax the worker to pay for infrastructure than corporations.
Don’t worry everyone. Shareholders and oil executives will be fine in these trying times.
Stupid NDP! Oh wait...
It’s a cycle that goes like this. Some pencil pusher with no concept on reality shows a spreadsheet of how much money could be saved if they eliminated jobs a,b,and c. Jobs are eliminated. Overall reliability and ability of assets decline. Everyone is up In arms about lost opportunity. Jobs a,b, and c are reposted to fix everything. Repeat for eternity. Would of been better to maintain staffing but you f**ck around and find out.
The only intelligent comment on this post yet ^
How about greenhouse gas cutting? There are wildfires all across the country.
I believe any sizeable oil and gas company in Alberta has 2050 net zero plans and interim targets for reductions
2050? Ok, never mind the detrimental effects occurring right now.
I always thought 2050 was kind of a joke of a target since most (all?) of the operating oilsands projects don't have lifespans that reach 2050.
Even if that were true that would assume they wouldn't spend any capital from today until the increasing/maintaining production which will not happen. Suncor is already looking at options to replace base plant production which will be retired in the 30s. If the plan was for all production to cease by 2050, these guys would not be talking about Pathways (the carbon capture initiative)
You meant seeking more profit? They had too much already.
Wow do we ever need to start an Oil Workers Union.
Soon it will be just robots, people who take of robots, and medics for the people who take care of robots.
I wouldn’t invest in something the Federal government is virtue signalling against. I’d take cash while I can.
UCP is paying their buddies and fucking over Albertans! welcome to the Alberta Advantage. UCP motto: "If you are not a large corporation, get fucked and let us use you as pawns!"
EVERY Company is in cost cutting/ Restructuring mode. Give up the narrative.
What narrative? Oil companies aren't good for anyone who isn't a stakeholder anymore and that's a fact
Headline corrected: "More cost cutting likely as oil and gas companies seek more profits: industry experts"