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Industry Brief Mining, Quarrying, and Oil and Gas Extraction Atlantic

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Industry Brief Mining, Quarrying, and Oil and Gas Extraction Atlantic Industry Brief Mining, Quarrying, and Oil and Gas Extraction Atlantic Region 2020 ABOUT THE INDUSTRY The mining, quarrying, and oil and gas extraction Employed Industry industry is comprised of three subindustries: oil 2019 Share % and gas extraction, mining and quarrying (except Atlantic Canada 17,300 1.5% oil and gas), and support activities for mining, and oil and gas extraction. New Brunswick 4,100 1.2% Prince Edward 300 0.4% The mining and quarrying subindustry is Island organized by the resource being extracted from the ground: coal, seven types of metals, four Nova Scotia 3,300 0.7% types of stone, sand and gravel, diamonds, salt, asbestos, gypsum, potash, and peat. Due to the Newfoundland 9,500 4.2% complex and varying geology of Atlantic Canada, and Labrador there is at least one extraction site for nearly all Source: Statistics Canada, Labour Force Survey of these resources located in the region. Employment Share Support activities for mining, oil and gas by sub-industry 26% extraction encompass a broad range of services such as: contract drilling and blasting; exploration 39% and testing; equipment assembly, maintenance and repair; and site remediation. Mining, All Oil and gas extraction Quarrying, Industries and Oil and Gas Mining and quarrying (except 35% Extraction oil and gas) 83% Males 51% Support activities for mining Source: Statistics Canada, and oil and gas extraction Census 2016 16% Females 49% This industry chiefly consists of large employers. If one of 6% 15-24 years 13% the jobsites shuts down, mass layoffs can occur. The 76% 25-54 years 63% viability of businesses in this industry tend to depend on EmploymentShare (%) of prices of their product on the global markets. Most 18% 55 years & up 24% employment in the sector is rural. Source: Statistics Canada, Labour Force Survey Mining, Quarrying, and Oil and Gas Extraction – Atlantic Region – 2020 Page 2 Top 5 Largest Occupations Employed 2019 % Share in Industry Underground production and development miners 2,325 13% Oil and gas well drillers, servicers, testers and related workers 875 5% Heavy Equipment operators (except crane) 800 5% Supervisors, mining and quarrying 800 5% Contractors and supervisors, oil and gas drilling services 12,375 7% Source: ESDC RECENT HISTORY The global pandemic has directly affected the oil and gas industry. As a result of much of the world experiencing a period of quarantine, oil demand dropped drastically without supply changing enough to compensate. This left global oil prices very low in Spring 2020. Given the precariousness in the world economy due to COVID-19, there still remains much uncertainty about the future of oil prices and demand. A large proportion of employment in the mining, quarrying, and oil and gas extraction industry is in Newfoundland and Labrador where there is much offshore oil drilling. Layoffs at the Hibernia offshore oil platform in Newfoundland and Labrador began in mid-June The West White Rose project, a $2.2 billion oil as the managing company decided to cease extraction project, was put on hold by Husky drilling for up to 18 months. Upwards of 600 Energy in March 2020 due to COVID-19. The people may have lost their jobs. project, 60% complete, was expected to produce up to 75,000 barrels of oil per day. Continued market uncertainty has led the company to put the project on hold indefinitely while they re- evaluate its viability and the company’s future in Newfoundland and Labrador. Vale’s nickel mine in Voisey’s Bay, NL suspended mining from mid-March to mid-June due to COVID-19. In 2017, Donkin Mine, an old coal mine in Cape Breton, NS reopened for the first time since 2001. In March 2020, it was announced that the Donkin Mine, operated by Kameron Coal, would close permanently as a result of adverse geological conditions. This resulted in the loss of 150 jobs. Mining, Quarrying, and Oil and Gas Extraction– Atlantic Region – 2020 Page 3 OUTLOOK Much of the outlook for this sector is uncertain due to the current economic climate. Due to much of the sector’s reliance on stable, high oil prices, extraction of oil and investment into many major projects have been delayed or suspended for one or more years until the global demand for oil picks up enough to allow project viability. Many oil companies have stated their intent for further oil exploration and expansion of existing developments, but knowing the exact timeline of when they will start these projects is next to impossible at the moment. Equinor has plans for two oil developments in the Mizzen and Harpoon field of Flemish Pass and one in the Bay du Nord. An extension to the Hibernia oil field at the Ben Nevis- Avalon reservoir is in the planning stages as well. The Terra Nova oil field, owned by Suncor, was expecting to receive a life extension investment in the next year; meanwhile it suspends extraction throughout 2020. The oil refinery in Come by Chance, NL is expecting to undergo a significant expansion. Outside of Newfoundland and Labrador, Northcliff Resources is hoping to begin work on a tungsten- molybdenum mine and processing plant 100 km northwest of Fredericton. In Nova Scotia, Peridiae Energy is hoping to start construction of its planned liquefied natural gas export facility in Goldboro. Note: In preparing this document, the authors have taken care to provide clients with labour market information that is timely and accurate at the time of publication. Since labour market conditions are dynamic, some of the information presented here may have changed since this document was published. Users are encouraged to also refer to other sources for additional information on the local economy and labour market. Information contained in this document does not necessarily reflect official policies of Employment and Social Development Canada. Prepared by: Labour Market Analysis Directorate, Service Canada, Atlantic Region For further information, please contact the Labour Market Analysis Directorate at: [email protected] © Her Majesty the Queen in Right of Canada as represented by Employment and Social Development Canada, 2020, all rights reserved.
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