How Ontario benefits from a strong oil and gas sector
Canada’s oil and gas industry is often considered to be an Alberta story, but some of its biggest benefactors and advocates are in Ontario.
People like Rory Ring, CEO of the chamber of commerce in Sault Ste. Marie.
Ring has described Canada’s oil and gas industry as a pebble in the pond that reflects and echoes right through the economy. It’s a sector he’s proud of and wants more Canadians to understand why.
“Canada leads the way in responsible resource development and demand for oil and gas is increasing. We need to educate Canadians and the world about the products that are made from oil and gas and how every facet of our lives depends on these products,” Ring says.
In Ontario in particular, oil and gas benefits people’s daily lives.
According to new CEC research, oil and gas supported 71,000 direct and indirect jobs in Ontario in 2017, and paid $2.1 billion in workers’ income. The sector added $7.7 billion in nominal GDP to the province’s economy, and purchased $7.3 billion worth of goods and services from other industries including over $4.3 billion from manufacturing businesses.
Manufacturing in Ontario is highly inter-connected to Canada’s oil and gas industry. Not only do Ontario manufacturers use Canadian-produced oil and gas in their operations, they also manufacture parts and finished products that are used in the oil and gas industry.
One example is Tenaris, a global steel pipe producer with a mill in Sault Ste. Marie. The company has a $117-million project underway to upgrade its facility to better serve the domestic energy industry by offering Canadian oil and gas customers longer welded pipes to improve the efficiency of their operations.
Toronto-based Automatic Coating Limited (ACL) is another Ontario company working closely with oil and gas. ACL provides powder and liquid coating services that help the industry reduce greenhouse gas emissions, according to vice-president Jocelyn Bamford.
“ACL digs up old pipelines, takes off the old paint, and then puts on the new paint. We decrease three pieces of equipment to one piece of equipment and reduce our GHGs by two-thirds,” she says.
“The development process to strip old pipelines with no emissions is a new technology that is very environmentally friendly.”
Canada’s oil and gas industry benefits from innovation by Ontario businesses, while Ontario businesses benefit from the trade of goods and services as well as reliable supply of the energy itself.
Manufacturers use oil and natural gas to heat their facilities and office buildings, as well as to heat water. Natural gas and diesel fuels are used to power machinery and fleet vehicles that are used to transport goods across Ontario, Canada and eventually to be exported globally.
“Sault Ste. Marie’s business community relies heavily on oil, gas and diesel because electrification is very difficult to use in the northern part of Ontario and many manufacturers in the area manufacture parts and finished products for Canada’s oil and gas industry,” Ring says.
Bamford, who is also president of the Coalition of Concerned Manufacturers and Businesses of Canada, says members prefer to use oil and gas for their operations because the infrastructure already exists and the energy is affordable.
“We need affordable energy to remain competitive,” she says.
Both Bamford and Ring argue that oil and gas-related manufacturers and businesses in Ontario generate government revenues that support infrastructure investments like new roads and bridges, as well as sponsoring community events, building sports facilities, and making donations and endowments to educational institutions.
Today’s benefits have evolved to include strong partnerships with educational institutions for skills training and upgrading, and joint ventures with Indigenous communities, Ring says.
“We need to communicate that Canada’s oil and gas industry is one of the most responsibly developed, heavily-regulated industries in the world that produces oil and gas under strict environmental policies, labour and human rights laws,” he says.
“Canada’s oil and gas industry is also a leader in energy technology innovation which contributes to fighting climate change.”