Alberta is working closely with Ottawa as the federal government crafts a strategy for helping the country’s struggling oilpatch, says the province’s energy minister, adding she’s expecting a package to come “very shortly.”
Sonya Savage, speaking to an online audience of investors and companies, also expressed faith that the package would include methods of helping the oilpatch with its financing challenges.
“I’m still confident that something’s coming out very shortly,” Savage said Tuesday morning to the Scotiabank CAPP Energy Symposium.
“We’re working very closely with them. And I’m not seeing anything at this point to be concerned that there’s not a liquidity package coming.”
When commodity prices are so low, oilpatch companies often struggle to obtain financing from banks, investors and the broader finance community.
Oil companies, drillers and service firms have been calling on the federal government to find some way to ensure there will be liquidity in the market during the current turmoil.
The oilpatch is struggling because of three main factors right now: the decision by Saudi Arabia and Russia to flood the market with oil; problems with accessing funding from equity markets; and COVID-19, which put the brakes on economic activity and crushed oil demand.
“Our finance minister, Travis Toews, has been in regular contact with [federal] Finance Minister Bill Morneau and our departments are working closely on what a liquidity package is going to look like,” Savage said.
“I still believe that they’re working very diligently on it, the federal government. These things take a bit of time. There’s a number of option proposals before them on exactly how to get liquidity back into the sector.”
Savage said she’s also anticipating some incentives to help clean up orphaned and inactive wells in Alberta.
Alberta Premier Jason Kenney is also expected to speak later Tuesday to the same symposium.