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Message from the Premier of Saskatchewan, Scott Moe
On behalf of the Government of Saskatchewan, it is my pleasure to welcome you to the 2022 edition of the Saskatchewan Energy Report.
Saskatchewan is proud to be Canada’s second largest oil producer. As demand for oil is expected to continue increasing and remain high for decades, we are well-positioned to see a strong recovery in our oil and gas sector.
Our oil industry is vital to building a stronger, more resilient Saskatchewan. The oil and gas industry contributes 15 per cent of our gross domestic product, and supports over 30,000 fulltime jobs and many communities in Saskatchewan. As well, royalties and other revenue sourced from the oil and gas sector help to provide high quality services and public infrastructure.
The Government of Saskatchewan launched the Accelerated Site Closure Program (ASCP), in partnership with the federal government and the Saskatchewan Research Council. The ASCP applies $400 million in federal funding for the abandonment and reclamation of up to 8,000 inactive oil and gas wells and facilities, over two years. The program prioritizes Saskatchewan based oil and gas service companies and is expected to support approximately 2,100 full-time equivalent jobs. The First Nations Stewardship Fund and the Indigenous Business Credit Pool are two initiatives that will direct ASCP funding to support First Nations and Métis participation in the program.
Our government has many incentives in place to maintain an attractive investment climate in the province and get our resources to market. Recently, Husky Midstream completed the first project under our Oil Infrastructure Investment Program (OIIP). Their Saskatchewan Gathering System Expansion pipeline project increased crude oil shipping capacity by 48,000 barrels per day. There are many Saskatchewan projects benefiting from our other freehold royalty credit incentives, the Oil and Gas Processing Investment Incentive (OGPII), and the Saskatchewan Petroleum Innovation Incentive (SPII).
Enbridge’s completion of their Line 3 replacement pipeline is more great news for Saskatchewan. The project will almost double current oil transport capacity and includes state of the art technology and safety measures, further proving that pipelines are the safest, most reliable way to move our oil to markets. Seventy per cent of Saskatchewan’s oil runs through the Enbridge Mainline, which includes Line 3 and connects to Line 5. Our government is actively supporting the efforts to prevent Enbridge Line 5 from being shut down, which would have serious impacts on North America’s energy security. We will continue to stand up for our industry by making the environmental and economic case for pipelines.
Leading environmentalists agree that emissions reduction targets cannot be achieved without CO2 enhanced oil recovery (EOR), that emits 82 per cent fewer emissions than traditional extraction methods. Saskatchewan is a world leader in carbon capture utilization and storage technology (CCUS) and EOR. Our government recently outlined our priorities for CCUS, which include expanding our OIIP initiative to include CO2 pipelines and increasing our competitiveness in EOR.
We commend and support our industry in their diligent efforts and investments to reduce emissions. This year, we saw Whitecap Resources and Federated Co-operatives Limited sign a memorandum of understanding to explore opportunities around shifting to CCUS, EOR and CO2 transportation infrastructure. This is just the beginning as we anticipate CCUS projects will attract provincial investment of more than $2 billion and sequester over two million tonnes of CO2 annually.
Our government will continue to use Saskatchewan’s Growth Plan as our road map for a decade of growth in the province. Including, working toward achieving our Growth Plan goal of expanding oil production to reach 600,000 barrels per year by 2030.
On behalf of the Government of Saskatchewan, we thank our oil and gas industry for their contributions to our province. We know you will continue to be at the forefront as we grow our economy.
Scott Moe
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