Weyburn, Lloydminster, Wawota – Election night, 2019. Pipeline News asked four people from the oilpatch across the province what the results of this election mean for the oilpatch. Those results, of course, were a Justin Trudeau-led Liberal minority government.
The reaction was universally negative, and harsh. And most followed up with a good dose of support for western separation as a result.
Dextor Mondor is owner of Dirty Bird Oilfield Services, based in Carlyle. He lives in Wawota. Earlier in the day, he said, “I can see the Conservatives getting a minority government.”
By 9:30 that night, it was clear there would be a Liberal minority, led by Prime Minister Justin Trudeau.
Asked what this means for the oilpatch, Mondor replied, “A lot of uncertainty.
“Some old boys are going to be close to panic mode. Younger guys will look to do other things.”
Age 37 himself, Mondor employs 13 people, from ages 19 to mid-50s. He thinks the Liberal win will eventually have an impact on his bottom line as part of a trickle-down effect from larger companies.
He felt at the time the resurgence of the Bloc Quebecois was having an impact.
“I can see us being back to the polls next spring, 2020,” Mondor said.
Asked if western separatism is now an issue, he agreed. “How can we stay? Nobody out east cares about the West, but the West drives the economy – oil, ag and mining.”
In Lloydminster, Marc Ouellette owns Olaco, Inc, a small trucking firm. He was active in the protests and convoy held in Lloydminster last winter. His co-organizer was Drew Lake, interviewed below.
Ouellette’s outfit used to employ five to six people. Now it’s down to two, and he ascribes some of that with the federal government. “Definitely it had to do with government policies affecting everything with regards to the business.
“I’m going to get up every day, and keep my head high. This will be difficult to visualize, the next three to four months.”
While others we spoke to that night spoke of western separation, Ouellette said he’s not sold on that issue, yet. “But definitely, the sentiment will be 10-fold tomorrow morning.”
Ouellette alluded to more activism in the near future.
Drew Lake is a lifelong oil and gas worker and former owner of Engage Energy Services in Lloydminster, a combo vac, vac and steamer outfit he sold last fall. The policies of the NDP government in Alberta and the Liberal government in Ottawa were a factor that drove that sale, making it hard to make a go of the business. He found that in three years under the Alberta NDP, his business shifted from 50/50 Saskatchewan/Alberta to 80/20. Similarly, while he said the federal government normally shouldn’t be a factor for the oil and gas industry, it has been.
“It shouldn’t be a big player. Overall, it should have little net effect, but they’ve made it so,” he said earlier on election day.
Regarding the possibility of a left-wing coalition forming government, Lake said, “I’m terrified. I’m not going to lie to you.
“National unity hangs in the balance of this election today. Educated, reasonable individuals without hesitation would support separation. To me, it’s unbelievable that we’ve gotten to this point.”
That evening, Lake said, “She’s not a good day. Unfortunately, I kinda suspected this was going to happen.
“You’ve got to consider what the oilpatch really is. The fact of the matter is it’s spurred by investment. I don’t think there’s too many investors out there, that are going to be very comfortable investing in Canada’s oilpatch right now,” Lake said.
“If you were representing a group of investors, would Canada’s oil industry be a place you’d invest? I think the answer to that is a pretty solid ‘No’ when you can compare it to other jurisdictions where investment is available. Look at Texas, the Permian Basin. Those are pretty safe investments, on a government policy perspective,” he said.
“When you look at it from a fundamental perspective, why on earth would you invest in production growth with no surplus export capacity? No surplus, whatsoever. We’re at the point where we have to curtail production to accommodate our existing export capacity. Investors are telling oil company CEOs that they’re not interested in production growth. They just want cashflow and returning it to the shareholders. That’s not good for a sustained economy. Basically, you’re stripping the guts out of the oilpatch for profits right now.
“It’s a sad state of affairs.”
Western separation has been all over his social media news feed. Lake said, “For years, there’s always been what you could call an extremist fringe. There’s been rumblings of western separation. Now you can go see your family doctor, your accountant, your grandmother’s friend at the coffee shop. These are very reasonable, educated, normal individuals who are saying there’s no longer a place for Alberta, or the west in general.
“People can forgive the rest of Canada for putting Trudeau in power. You have to admit, his message was fairly refreshing, it was inspiring, in 2015, when he was elected. There’s a lot of us who weren’t happy about it then. But you could understand how people would vote for that sort of person and movement. But given the track record, and what we’ve seen out of this government, it’s appalling the rest of Canada could actually give him another term, even though it’s a minority. It’s unfathomable, to most people in the West, that this could even be an option.
“And I think it’s starting to make people realize that our fundamental differences across the geography of this land may be becoming more than we can sustain,” Lake said.
John Prette spent most of his career working in the oilpatch, but for the last five years has worked in the auto industry. He works in Estevan and lives in Weyburn.
“I don’t know if I would go so far as to call it a death nell, but it’s a terrible result. A Liberal minority propped up by the NDP, I don’t see a path to getting a pipeline completed,” Prette said.
Construction of the Trans Mountain Expansion pipeline is under way. “If we can get it completed within the next 18 months, that still doesn’t address to me the investment that’s already left the country, and how difficult it would be to attract that investment back, in the presence of taxation policies that aren’t competitive with other oil producing regions.”
Prette was referring the the U.S.’ clear advantage in corporate taxation. “If I had to invest my money in the current regulatory climate, I’m going to invest my money in the U.S. where there’s a lot more certainty that I’m going to be able to complete that project and get my product to market.
“I don’t think transporting our product ends with Trans Mountain. I don’t think one pipeline is all we need. I think we have to go east. It’s difficult for me to fathom the hypocrisy of not using Canadian oil while we’re using Saudi oil and all kinds of regimes that have less favourable environmental and human rights records. We should be striving towards energy self-sufficiency, just like our neighbours to the south did, and achieved it,” he said.
With regards to western separation, Prette said, “My social media has blown up with it.”
“Separation, without a coastline… I guess we could go to Hudson Bay. Manitoba could build a pipeline from Cromer to Churchill,” he said.
“I’ve recently changed my opinion. Western separatism doesn’t mean forming a separate country. I have the view the coastline exists to the south. I think we’d be joining the U.S. I think that’s what separation really means,” Prette said.
He thinks western separatism will be a real issue. “I think people rightfully realize the country can’t survive another four years. Division within the country is unprecedented. Even Pierre Trudeau didn’t alienate the West as badly as Junior has.”