The worst is over for Canada’s resource sector, but the immediate future is far from certain. A session held by several Canadian industry stakeholders at the Canadian Construction Association’s recent annual conference in Mexico highlighted a lack of new and updated infrastructure and a complex web of regulations keeping projects from going forward as primary concerns.
Canadian Electricity Association CEO Sergio Marchi said a "politicization" of energy rates is having a negative impact on the industry. Heightened public attention towards rates translates to pressure on governments, he said, leading to pressure on energy regulators to keep costs down.
But while regulators want to reduce costs, government also calls for innovation and "we’re caught in a ping pong match," he said.
"We should try to avoid a storm of short-term thinking, quick fixes and political U-turns," Marchi said, stressing the importance of long-term planning to the utility industry.
But infrastructure funding for "transformational" projects would help bridge that gap, he explained, along with the modernization of existing infrastructure.
"Current infrastructure is reaching the end of its life cycle," Marchi said.
The utilities and the government must be transparent and open to explaining the need for these investments to the public, he added, and resist the temptation to "race towards the bottom" and go for the cheapest price on infrastructure.
Obtaining social license for infrastructure projects is also proving difficult, he said, as local municipalities try to veto projects based in their area.
"But national utility projects must balance local against national interests," Marchi said.
He also cited the Paris climate change accord as a real shift and said the utility sector has long called for the reduction of carbon levels.
Canadian Association of Petroleum Producers CEO Tim McMillan said the oil industry is "on the way back up" and pointed out that while the industry has fallen on hard times, it still represents approximately 12 per cent of the value of the Toronto Stock Exchange.
The oil and gas industry, he said, invested a peak of $81 billion in 2014 and is down to a forecast $44 billion in 2017.
Canada was particularly badly hit during the downturn, while the United States fared better thanks to the move towards fracking under former President Barack Obama. The United States is now a net exporter of oil.
"They were less invested and recovered more quickly," he said.
Current U.S. President Donald Trump has indicated he will reduce regulations, McMillan said, and "the prevalent attitude in the United States is to invest in itself first and the rest of the world later, and Canada is part of that ‘rest of the world.’"
"At a high level, there’s good news, bad news and a lot of uncertainty," said Brendan Marshall, vice-president of economic and northern affairs with the Mining Association of Canada.
The industry has emerged from a painful downturn in commodity prices, he said, but Canada is not competitive compared to the rest of the globe and is becoming less of a destination for mining investment.
Regulatory reform took place under the former Stephen Harper government, he added, and was enacted a year before Justin Trudeau was elected on a platform of revisiting the previous government’s regulations.
"So we had five years of uncertainty and now probably another three years, the better part of a decade, and that’s driving business away," Marshall said.
He also stressed the importance of opening remote and northern regions to further economic development through infrastructure development.
"But resolving the regulatory hurdles will be key to this happening," he said.