The offshore oil industry has offered a lot. Let's talk about where we go next
Should we play a key role, or be content to stand on the sidelines?
I think it is time to have a frank conversation about how the offshore oil and gas industry has benefited our province, and how we overcome current challenges to ensure it can continue to be an economic driver for our province and country for the future.
We need to decide: are we all in for this industry or are we content to stand on the sidelines only occasionally joining the game?
It seems that provincially we want in.
Data from a recent survey conducted by Noia suggests that a vast majority (86 per cent) of Newfoundlanders and Labradorians support offshore oil and gas development.
In many ways, I believe we have reached a crossroads when it comes to the provincial economy and the offshore oil and gas industry.
Government has a plan for the future of the industry in Advance 2030. Its goals are laudable, and the province is taking steps to achieve them. Yet, when it comes to the regulations that govern our offshore that are decided in Ottawa, we have a long way to go.
Offshore oil and gas has brought tremendous benefits to our province. It has significantly benefited the provincial government and provided tens of thousands of well-paying jobs to residents here.
Think back just a few years ago to the peak of the oil and gas industry in this province.
Employment was up, royalties and taxes to the provincial coffers were up, and in turn, taxes paid by you and me were down. During this period, higher incomes and lower taxation generally led to more discretionary spending. Car dealerships were extremely busy. Folks were calling dealerships and ordering trucks over the phone.
Housing starts and home sales were up. If you were involved in building houses you probably had more work than you could keep up with. If you had a company, you hired people.
And it was not just major purchases such as housing and vehicle sales that were peaking.
New restaurants opened and people went to them — and it wasn't just Friday and Saturday nights. It was every night of the week.
People had more disposable income. When you have increased discretionary spending, it allows you to outfit your home with high-end electronics, have a quad at your cabin, or a new RV in a park where your kids can swim and play with their friends all weekend.
Spinoffs felt throughout the province
The benefits were seen not just in St. John's and the surrounding area. People from across the province worked in the offshore oil and gas industry and brought those good wages back to their communities. A recent study conducted for Noia demonstrated the benefits were felt in all our communities.
Schools and health-care facilities were being built, along with improvements to our road infrastructure. When the offshore oil and gas industry is thriving, there's money in the provincial coffers for these important public services.
When the price of oil took a downturn there is no doubt the entire province took a hit — as did the global economy.
The global industry has learned many lessons in the last number of years. In order to be successful, everyone involved in the oil and gas industry has had to change the way they operate.
We want to see a return to the peak of our industry and sustain that level of economic activity for decades.
Newfoundland and Labrador companies involved in the supply and service industry are no different. We are industry leaders and we've adapted.
We have survived and are ready for the next challenge. We hope that challenge is a new offshore development, one that showcases our expertise and allows us to grow and expand our unique capabilities.
We want to work on the next project offshore and employ our residents.
We want our industry to reach its potential and we want to be economic contributors to our province and our country.
We want to see a return to the peak of our industry and sustain that level of economic activity for decades, as everyone benefits when our industry is thriving.
We've weathered the low price of oil and found our place in the global industry — and have emerged stronger, wiser, and prepared to succeed. And we are only at the early stages of our industry with these lessons already learned.
Encouraging international investment
Now we must ensure it's not a regulatory obstacle that curtails our ability to be successful. We need processes related to the offshore that allow us to be competitive and encourage international investment.
We know we're blessed with natural resources beneath our ocean floor and those resources are needed. We also know they are wanted. Oil companies will only supply what we, as consumers demand.
International companies marvel at our offshore potential. They recognize the global impact it can have, and they recognize the ability of the Newfoundland and Labrador supply and service industry to support safe and responsible development.
Simply stated, our industry needs processes that support international investment and global competitiveness. If we have that, our industry can do the rest and every resident of this province will benefit from a thriving offshore oil and gas industry.
That is our goal and hopefully we we can accomplish it together.
What's your view?
We welcome pitch ideas for Point of View columns for CBC Newfoundland and Labrador. Get in touch by clicking here.