A new report suggests the five major oil producers are doing ‘just fine’ since prices crashed in 2014.
A study released Thursday by Parkland Institute analyzed the economics of Suncor, CNRL, Cenovus, Imperial, and Husky through the 2009 to 2017 boom, bust, and consolidation commodity cycle.
The report, Boom, Bust, and Consolidation: Corporate Restructuring in the Alberta Oil Sands, found the Big Five paid $31.76 billion in dividends to shareholders in those years.
Last year alone, the oil giants had an aggregate gross profit of $46.6 billion, which was close to the Alberta government’s revenues of $47.3 billion.
“There’s no question that the price crash had a major impact on the industry in Alberta, most importantly on the almost 20,000 workers who lost their jobs in 2015, but the Big Five are doing just fine,” said Lead Author Ian Hussy, in a release.
Hussy says these companies, which produce 80 per cent of Canada’s bitumen, have been able to shift their operations in response to the market condition to ensure they remain profitable despite the issues that have been dominating the headlines in recent months.
Third-quarter numbers released last week show both Suncor and CNRL had net earnings of $1.8 billion, while Cenovus lost $242 million from July to September.
Hussy argues the biggest question emerging from the report is how to reconcile the forecast increases in emissions from the oilsands sector with the need for science-based reductions in carbon emissions.
“Albertans have to ask if it’s worth it to continue to bet on the cost-cutting sector with weak fiscal and employment benefits that has emerged from the crash, or if now is the time to put in place the policies to position the province to benefit from the ongoing global energy transition.”
The report was undertaken as part of the Corporate Mapping Project, a six-year research and public engagement jointly led by the University of Victoria, the Canadian Centre for Policy Alternatives BC and Saskatchewan Offices, and Parkland Institute.