EDMONTON — A downturn in the oil sector has permeated Alberta, but the minister of economic development and trade is optimistic a turnaround is coming.
“A lot of economists tell us Alberta is set to grow GDP (gross domestic product) more than any other province in the country,” said Deron Bilous.
“Oilsands production is expected to set records in 2017,” he said at the Alberta Association of Municipal Districts and Counties spring meeting held in Edmonton March 20.
A projected 2.5 percent growth is attributed mainly to two new pipeline approvals so oilsands can get product to tidewater, as well as capital investment and infrastructure connected to the pipelines.
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“We are starting to see some investment come back,” said Ben Brunnen, vice-president of the Canadian Association of Petroleum Producers.
While some recovery appears on the horizon with a small uptick in production in Western Canada, the grim reality of slumping oil and natural gas prices has affected the Alberta economy. Retail sales are down 6.5 percent, vehicle sales are down 19.3 percent and value of homes sold on the Multiple Listing Service is down 29 percent, said Brunnen.
There are indications of an up-swing. Drilling numbers have been down, but 2017 shows more wells are coming online throughout Alberta. However, oilsands projects lag because of the amount of money required to develop oilsands initiatives.
“From an oilsands perspective. It is a different story. It continues to be challenged from an investment perspective globally,” he said.
Global oil market demand and supply is coming back but prices are not expected to recover quickly.
