June 22, 2017
For Immediate Release
Premier Fueling Uncertainty in Oil Industry, Providing No Answers on Carbon Tax
Keith Hutchings, Natural Resources Critic for the Official Opposition, said, “Premier Ball is fueling uncertainty in the oil industry by providing no details about how a mandated carbon tax will affect the province’s future royalties and what oil and gas industry developers can expect in this province.”
“When the Premier gave a major speech this week to Noia, the province’s oil industry community, he was unable to provide even the most basic information on the impact the carbon tax will have for the industry whose leaders he was speaking to,” said Hutchings.
“There is uncertainty enough in the global oil industry without the Premier adding to it. Nothing concerns oil industry decision-makers more than not having predictability in costs related to the economics of offshore projects they are operating or considering development.”
“That lack of predictability as related to the federal government’s mandated carbon tax is of the provincial Liberal government’s making. Ottawa is demanding some sort of carbon tax. The Ball Liberals introduced carbon tax legislation in 2016 allowing the province to impose measures of our own design on five industries in the province, after two years of monitoring emissions and Cabinet would then decide behind closed doors on taxation levels. This Bill contained amazingly no direction on offshore development and regulating a carbon tax for that industry, even though questions were asked in the House of Assembly at the time by the Official Opposition. We expect the province to lead on this issue, but after months of uncertainty, we still have no answers – only speculation,” said Hutchings.
“Investors flee from uncertainty. The oil industry likes predictability. When there are huge and costly unknowns, there’s a very big risk that they will back off, costing this province developments that we cannot afford to lose.”
“It’s time for the Premier to start providing answers. His speech to Noia would have been the perfect opportunity for him to do that, with everyone gathered and waiting to hear the details that they expected the Premier to provide. It’s an opportunity missed,” said Hutchings.
A recent announcement by Husky to proceed with the White Rose Extension still has no details on who will pay a carbon tax: Newfoundlanders and Labradorians; Husky and its partners; consumers. We should know this now and how it affects any agreement.”
“If the province is serious about imposing a ‘made-in-Newfoundland-and-Labrador’ solution, then it falls on the Liberal government’s shoulders to tell the industry precisely what solution they are planning to impose. It’s not the global markets or outside forces that are responsible for this particular uncertainty. It is the Liberals, federal and provincial, whose failure to get their act together is fueling this uncertainty. Stop stalling. Let people in on the details of the approach the province and Ottawa intend to impose,” said Hutchings.
Heather MacLean, Director of Operations and Communications
Office of the Official Opposition
(709) 729 6105, firstname.lastname@example.org