Message from the Saskatchewan Minister of Energy and Resources
hon. bronwyn eyre
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n behalf of the Ministry of Energy and Resources, I am pleased to join Premier Scott Moe in offering welcoming remarks in the 2019 edition of the Saskatchewan Oil Report. In light of the drastic impacts of the COVID-19 pandemic and the oil price war between Russia and Saudi Arabia, the Government of Saskatchewan implemented a number of relief measures for the oil and gas sector on April 14. These included extending mineral rights licences by one year, delaying filing deadlines to assist in stabilizing operations, and reducing the industry portion of the Oil and Gas Administrative Levy by 50 per cent this fiscal year. We continue to examine other relief options. The plunge of oil prices into actual negative territory was not anticipated, and we continue to call on the federal government to provide further, substantial support for the Canadian energy sector. Going forward, Saskatchewan will continue to be a highly competitive jurisdiction that offers a solid investment and royalty climate for the oil and gas sector. A pair of recently released, independent reports, which analyze oil and gas investment opportunities across North America, prove once again that Saskatchewan is a leading destination when it comes to capital investment in the oil and gas sector. The 2019 Scotiabank Playbook ranked the Southeast Saskatchewan Mission Canyon Frobisher/Alida oil play as the most profitable on the continent, while the Southwest Saskatchewan Cantuar oil play was ranked seventh overall. With two of the top 10 plays, Saskatchewan has a total of seven plays ranked in the top 35. As well, in the Fraser Institute’s Canada-US Energy Sector Competitiveness Survey for 2019, Saskatchewan was ranked by industry respondents as the most attractive jurisdiction in Canada for upstream oil and gas investment. The report noted Saskatchewan’s horizontal drilling royalty structure as particularly attractive for investors. In November, we announced Saskatchewan’s Growth Plan: The Next Decade of Growth, which includes ambitious 14 Saskatchewan Oil Report 2020
targets that will ensure we continue to attract oil and gas investment dollars from a sector that drives our economy and helps grow and sustain our communities. These targets include increasing oil production by 25 per cent, to 600,000 barrels per day and increasing the value of Saskatchewan exports by 50 per cent over the next decade. Our commitment to fostering a leading operating environment includes targeted royalty programs that stimulate investment, such as the new Waterflood Development Program, which is now open to applications. This past year, we also introduced the Oil and Gas Processing Investment Incentive (OGPII), which is designed to increase value-added processing and infrastructure capacity, while lowering greenhouse gas emissions. OGPII will operate as part of our Methane Action Plan (MAP), which has been well-received by industry and recently achieved draft equivalency after months of engagement with the federal government. Our government also introduced an updated research and development incentive, the Saskatchewan Petroleum Innovation Incentive (SPII), which provides a tax credit to encourage and stimulate commercialization of gas processing. Earlier this year, we also introduced the Oil Infrastructure Investment Program (OIIP), a transferrable royalty credit aimed at getting Saskatchewan resources to new markets. The program provides a credit worth 20 per cent of approved capital expenditures for eligible pipeline development projects with a minimum investment of $10 million required, with the potential for each project to earn a maximum of $40 million of royalty credits. Despite current, unprecedented economic challenges, the Government of Saskatchewan is proud to promote our vital oil and gas sector, to the country and the rest of the world, as the innovative, technologically top-in-class sector that it is. Let’s always embrace positive Canadian energy. v
