Chief executive officer Kevin Neveu of Precision Drilling, one of the
representatives for the oil patch who has been in talks with Ottawa
about its COVID-19-related support programs, says much more needs to be
done. "The industry's really been crushed over the last few weeks.
Crushed," he emphasized to BNN. He acknowledged that many sectors are in
trouble right now, but given the importance of energy to Canada's GDP
and employment levels, a recovery in this industry would have a
"multiplying effect" on the rest of the economy. Yet Ottawa's liquidity
programs are nebulous and do not address the sector's specific needs.
Liquidity is not the only problem for Canadian energy producers:
"Investors view Canada as unfriendly to hydrocarbon investment," said
Mr. Neveu, opining that the government has not done enough to push back
against "anti-hydrocarbon rhetoric." The result is that Precision has
been moving more of its activities and jobs to friendlier jurisdictions
across the border. Mr. Neveu estimated that Precision's U.S. business is
three to four times larger than its Canadian one, in part because
"capital is still flowing to our U.S. customers -- but nothing in
Canada." Canadian customers remain "on their knees."
Mr.
Neveu is not the only one expressing dissatisfaction with Ottawa's
liquidity programs. "We have not seen one company access credit in any
of the programs, to my knowledge," chairman Jeff Tonken of the Canadian
Association of Petroleum Producers (as well as the CEO of Birchcliff Energy Ltd.
(BIR: $1.42)) told Reuters. He blamed limited details and impractical
criteria. "You almost have to be out of money to apply. [Businesses]
don't wait until we're out of money and then make a phone call," said
Mr. Tonken. CEO Jonathan Wright of NuVista Energy Ltd.
(NVA: $0.90) agreed and noted that some of the most basic aspects of
the programs, such as when the money will be available and for how long,
are still up in the air.