CAPP likes parts of federal budget, but seeks clarity on emissions and doesn’t like new taxes

Brian Zinchuk

Brian Zinchuk is editor and owner of Pipeline Online

Panther Drilling working in the Whitecap Resources-operated Weyburn Unit on Feb. 24.

The Canadian Association of Petroleum Producers likes some parts of the April 16 federal budget, but not others. CAPP released the following statement from Lisa Baiton, president & CEO:

Canada’s world-class resource base stands as one of our foremost competitive advantages. The Bank of Canada has warned that weak productivity and low business investment is a national emergency. An economic and public policy environment that leverages Canada’s world-class resource base to provide well-paying jobs for Canadians, revenues to governments, and Canadian LNG to displace higher-emitting forms of energy overseas, has the potential to address this emergency.

The inclusion of the oil and natural gas industry in the National Indigenous Loan Guarantee Program is a significant advancement. Given that Indigenous equity deals in Canada predominantly involve oil and gas projects, this program opens avenues for Indigenous communities to access capital, fostering economic reconciliation and self-determination.

CAPP looks forward to Carbon Capture Investment Tax Credit receiving Royal Ascent, three years after its initial announcement. Such a credit holds the promise of enhancing Canada’s competitiveness against other jurisdictions in carbon capture utilization and storage (CCUS) projects, potentially attracting vital investment and helping meet climate targets.

Industry uncertainty lingers around the government’s proposed emissions policy. Clarification in this area is essential to inform investment decisions and uphold Canada’s status as an economic and environmental leader, both domestically and globally.

Layering on new corporate taxes on top of regulatory uncertainty and costs undermines Canada’s attractiveness for investment on the global stage. Royalty and tax frameworks already in place for the oil and natural gas industry ensure Canadians benefit significantly from the development of their valuable natural resources. Total government revenues in 2022 reached $45 billion, up nearly ten-fold since the historically low commodity prices in 2020. These revenues help governments to build critical infrastructure, operate schools and hospitals, and support vital social programs on which Canadians rely.

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