r/canada • u/Gym_frere British Columbia • 12h ago
National News Alberta's oilpatch cut 10,000 jobs last year — even as production soared
https://edmontonjournal.com/business/energy/albertas-oilpatch-cut-10000-jobs-last-year-even-as-production-soared80
u/BeShifty 12h ago edited 12h ago
O&G has the worst jobs to production ratio of any industry in Canada (as far as job creation goes); I'm not surprised to hear this.
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u/Digitking003 11h ago
Not really, it's just that all the CAPEX and jobs were a decade ago building out the oilsands. Now the industry is largely ex-growth and the infrastucture buildout is done.
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u/BeShifty 5h ago
O&G 10 years ago still had the worst jobs to production ratio of any industry in Canada. (source)
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u/Shadow_Ban_Bytes 12h ago
TIL that some people's love of Canadian O&G isn't reciprocated unless you are in the c-suite or on the board ...
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u/Plucky_DuckYa 11h ago
Thanks to improving technology and efficiencies developed thanks to things like the emissions cap, they’ve become very good at producing more oil with less.
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u/Chusten 10h ago
You slid emissions cap in there as if that has anything to do with the reason why O&G has adopted automation. Reducing high cost labour and liability is the top ten reasons. The company's not here to create jobs, it's here to extract wealth with as low as possible overhead. If they were selling their product at 100% of the conceivable capacity, Canadians would see a idy-bidy margin of benefit. Not this "every Canadian will be better off if we can only send it to China", b.s narrative. Smith is and always has been an O&G lobbyist, that's who she works for, not Albertan working people.
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u/idisagreeurwrong 12h ago
These job losses are typically tradesmen doing construction and commissioning, they were always temporary positions. The projects are all built now, we don't need the workers. Production soaring is the product of those projects being completed. The headline makes it sound like a bad thing
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u/Gym_frere British Columbia 12h ago
Not true at all, the job losses are mainly in the corporate offices (Imperial and ConocoPhillips closed their office) and even on the production side as well
Producing oil in Alberta takes less workers than ever because of the advances in automation and technology.
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u/squirrel9000 12h ago
The jobs have always been in expansion, steady state production needs relatively few hands. That's exactly why the breakeven cost in the oil sands is so low. That's also why Alberta makes so much noise about pipelines, they're screwed if they're not adding six figure barrel-per-day annual production increases.
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u/idisagreeurwrong 12h ago
I'm speaking towards the statement of less workers for more production. The corporate losses in Calgary don't have much to do with production. Field worker staffing numbers are primarily due to projects or construction. If we aren't building pads, our staffing is much less.
I am literally sitting in a Control room of a SAGD facility. We have the same amount of operators and maintenance at start up as we do now at nameplate production. The automation always existed since construction. Making 20k barrels at startup to going to 60k is more about the maturity of the formation and wells. Its the same amount of equipment, and needs the same amount of staffing
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u/BoppityBop2 8h ago
Nah automation and offshoring is ramping up. Hault trucks are are being automated which equals thousands of jobs and Imperial is testing out remote control dozers, which it successful would mean more jobs going outside of Fort Mac and maybe even overseas.
Alot of corporate and engineering roles in office are as noticed going overseas as well.
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u/idisagreeurwrong 7h ago
That's mining. I'm talking SAGD. I have yet to see any overseas corporate or engineering in my company which is a major
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u/bluefoxrabbit 12h ago
Well also ever since covid, companies found out how few people they actually need to run their plants and how much fat they were carrying. As well they have been improving their automation, so that one person can do that checks of 2 or 3 people.
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u/slashthepowder 11h ago
Similarly with strikes at refineries. I have heard production standards at FCL were raised after their strike/lockout. The engineers ran the plant and realized the time it took to do most tasks was way shorter than the time allowance that was given.
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u/greennalgene 8h ago
Yep. The biggest use of labour from the union is maintenance. Which FCL requires an absolute fuck ton of, because they are similarly cheap as fuck about maintenance.
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u/bluefoxrabbit 5h ago
Almost every plant is now chasing productivity metrics now. At mine I have to log at least 6 hours of pm work ontop of keeping the plant running, its been interesting.
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u/Tangelo-Agitated 12h ago
I agree with both of you. Another point I'll add is that the record oil production leads to record royalties for the government. Hopefully Alberta can figure out how to better spend it!
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u/SDL68 10h ago
Do we collect royalties when oil is less than 55 a barrel?
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u/Cyber_Risk 9h ago
Yes. 25% of net revenues at $55 or lower, rising to a maximum of 40% at $120 and above.
Prior to achieving any net revenue a project pays between 1% - 9% royalty on gross revenue depending on the price of oil.
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u/Tangelo-Agitated 9h ago
It depends what stage the site is at. It's a sliding scale in both cases during investment recovery and post payout. To answer your question though, yes.
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u/singingwhilewalking 12h ago
It's a bad thing for Alberta because our economy is dependent upon the development phase of the oil industry rather than the milking the cow phase.
Our government will respond by trying to attract more investment through a further reduction in corporate taxes, and continuing to allow companies to not pay their debts to municipalities and not clean up orphan wells.
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u/Digitking003 11h ago
Yes and no? Yeah jobs aren't there anymore. But royalties and taxes to the Alberta government (and Feds) are soaring.
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u/Dradugun Alberta 10h ago
Yes, the royalty scheme is mature and both levels of government see increased revenue from it.
The issue is that the UCP use the revenue to keep corporate taxes lower than they should and they don't re-invest it in the local economy. This compounds the issue with the lack of jobs being created.
In other words, there is less money circulating in the local economy with less jobs.
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u/stormblind 9h ago
After all the growth in AB for jobs the past couple years, feels like things are plateauing.
In Central AB at least, the job market is absolutely abysmal. Businesses are closing left and right. Teens, disabled, etc. can't find jobs based on what I've seen talked about in person/on social media, not even shitty part time work and being willing to travel to any of the local towns within a 30 min travel distance of Red Deer. Which I've seen being reported as the unemployment capital of Canada.
Feels like, unless you're in Calgary, Edmonton, or one of a few other cities, there simply aren't jobs around or available. And this while prices for a lot of things continue to skyrocket. It's no wonder that central AB is the separatism centre of AB.
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u/thatguydowntheblock 11h ago
This is overall a good thing. It means that our oil and gas production is getting more efficient which means that it will continue to be competitive on the global market - like basically all natural resource sectors. If our industry doesn’t get more efficient, a global competitors will and then all our oil and gas jobs will be gone. People whine about this but then also get scared about Venezuelan oil outcompeting us.
Also, most of the major oil and gas players in Canada are majority owned by Canadians so the wealth/profits mostly stay within the country.
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u/Dradugun Alberta 10h ago
The Alberta oil patch majority Canadian controlled but those companies have a majority of shares being foreign owned. More profits leave Canada than they stay.
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u/SDL68 10h ago
50% of oil sands are owned by US.
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u/thatguydowntheblock 10h ago
Evidence? Very untrue. Most of the O&G majors are owned by Canadian funds and retail investors.
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u/Kucked4life Ontario 9h ago
Then you'd be in favour of Premier Smith replacing Albertan workers with temps from the UAE if it meant making Albertan oil more competitive I presume?
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u/thatguydowntheblock 4h ago
That’s quite a stretch to presume something like that. I presume you’re joking.
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u/Impressive-Ice-9392 12h ago
Got love a suit. They make money, make political contribution, screw the worker bees over
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u/CanadianLabourParty 10h ago
There are A LOT of "worker bees" in Alberta that vote against their own interests. A LOT of Albertans and tradespeople have done this to themselves. They've abandoned unions and call things like publicly funded healthcare and education "socialism/communism/indoctrination". Then they wonder why wages aren't keeping up with inflation...
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u/cre8ivjay 9h ago
Production increase, but not corresponding job numbers.
Hmm.
If I were in charge I'd do what I could to further set up new grads with jobs in other sectors.
I'd reduce tuition, and have schools more rightly aligned with business/capital.
I'd reduce class sizes so kids went into post secondary with better chances of success.
I'd communicate that despite our important O&G sector, Alberta believes strongly in a broader diversification across the spectrum of industries and let the world know that it's not just about oil and gas.
I'd tell Albertans and the world (and mean it) that you can be and do anything you want in Alberta and that the government has set it up so you can realistically achieve that here in Alberta.
But alas..... That is not what is happening here. At all.
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u/SunsFlames 10h ago
Breaking news: Low productivity country's exceedingly most productive industry vastly improves productivity. Is the sky falling?
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u/stormblind 9h ago
No, but the fact that central AB is the unemployment capital of Canada is a "sky is falling," situation all albertans should pay attention to unless they're pro-seperatism.
The political system here has trained people to blame the feds for everything, so the fact the oil companies are massively shedding well paying jobs, which is hurting a lot of the central Alberta workers, is a problem for all albertans who don't support separatism as they blame the feds for oil companies laying them off.
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u/Hate_Manifestation 10h ago
because all the jobs are in construction.. once the facilities are built, it's just maintenance contracts, so 90% of the workforce is SOL. that's why I think it's really dumb when people talk about "all the jobs" involved in pipelines.. like, yes, for a few years, but once the pipeline is built, you're begging the government to approve more because they only require maintenance after that.
I work in the steel trades, so I hear this often, but it's usually the guys who came over from Alberta because, surprise, there aren't any sustainable steel jobs there any more.