Medicine Hat named as a possible hub for more petrochemical investment

It lists Medicine Hat, Grande Prairie and Joffre as places to invest in new infrastructure and energy corridors for clusters of such production facilities.

Councillor Darren Hirsch said it’s nice to see Medicine Hat recognized as a place to invest.

“We were pleasantly surprised of the announcement, so hopefully more positive details can come,” said Hirsch.

“Right now, we’ve got staff working with the provincial government, trying to understand the particulars of the announcement and what the implications are.”

Medicine Hat is already home to a few petrochemical industries including Methanex, CF Industries and Cancarb.

In the past few years the city has been investing heavily to upgrade its utility infrastructure, especially when it comes to power.

In November of 2017, the city brought on a new power generation facility online. The project cost just over $55 million and has room to expand in the future

Hirsch said that investment has been in an effort to help attract more big business to the city.

“[Companies] don’t have to go to multiple agencies to worry about utilities and where they’re going to put their servicing and that sort of stuff,” he explained. “We use that as a competitive advantage for sure and we certainly promote it.”

The NDP Government has pledged to invest $1 billion in oilsands bitumen upgrading. The money will be used for loan guarantees and grants to attract between two and five partial oil upgrading facilities. It’s expected that will result in $5 billion in private investment.

“I kind of applaud the government for at least recognizing there’s an opportunity here and trying to do what they can to help that along,” said Glen Allan, an economics instructor at Medicine Hat College.

While financial incentives may help encourage companies to invest in Alberta’s energy and resource sectors, Allan said there needs to be support from the federal government as well.

In Tuesday’s federal budget, the government said more analysis was necessary before considering tax cuts to match the U.S., which announced it would drop its federal corporate tax rate from 35 per cent to 21 per cent.

Allan said that’s a bit of a disappointment for many in the business community.

“There’s not much in there to do with economic development,” he said. “It’s more fairness and equality and very little on dollars and cents.”

Meanwhile Statistics Canada says capital spending to extract oil and gas will fall for a fourth straight year in Canada.

A survey of investment intentions in the resource sector found spending is expected to be around 12 per cent lower than in 2017, at $33.2 billion.

It says the largest spending decline is anticipated in Alberta, but investment will also fall in Newfoundland and Labrador, British Columbia and Saskatchewan.

Even with Alberta making the effort to attract private investment, Allan said the federal government needs to do its part to compete with our neighbours to the south, or risk losing further investment to the U.S.

by Leah Murray

Medicine Hat named as a possible hub for more petrochemical investment

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