The Canadian Association of Energy Contractors — which represents drilling rig and service rig companies across Western Canada, as well as offshore drilling rigs in Atlantic Canada — is lobbying the government for a 50-per-cent-refundable tax credit for drillers seeking to develop and deploy new carbon abatement technologies.Sign up to receive daily headline news from the Calgary Herald, a division of Postmedia Network Inc.
While a formal cap on emissions from the oil and gas sector is still in development, the federal government stated in its Emissions Reduction Plan earlier this year that it believes the industry can slash its emissions by 46 per cent from 2019 levels, to 110 million tonnes, by 2030. However, he said his industry is only just now recovering from a brutal seven years of oil price downturn and layoffs. While that streak finally snapped in 2022, with a return to soaring oil prices and steady drilling activity, the industry is just starting to see significant levels of capital investment again.
He said a tax credit specifically for drillers would also help energy service providers pivot towards work in the alternative energy space. The CAOEC said Wednesday it expects 6,409 wells to be drilled in Canada in 2023, an approximately 15-per-cent increase from 2022. “This is a good time to be in the industry, for those who stuck around in the bad times,” said Mike Belenkie, president and CEO of Advantage Energy Ltd., in a panel discussion at Wednesday’s industry event.