Contributing to the economy
As a Canadian oil company committed to developing the oil sands and our conventional oil and natural gas resources responsibly, we contribute to the economy and to the wealth and prosperity of the communities where we operate. Our contributions include:
- Paying taxes and royalties to multiple levels of government
- Paying dividends to our shareholders and interest to our lenders
- Purchasing goods and services from local and Aboriginal suppliers, as well as from businesses across Canada and the United States
- Driving innovation with investments in research and technology development through a number of collaboration projects
- Enhancing quality of life and opportunities for the communities where we work and live through our community investment programs and in-kind donations
- Providing direct and indirect jobs in Alberta, Saskatchewan and across Canada
2016 Cenovus contributions
The downturn in commodity prices that started in late 2014 has had an impact on our cash flow. In 2016, we continued to make progress on lowering our operating costs. We reduced our per-barrel non-fuel oil sands operating costs by 13 percent compared with 2015, achieving a 30 percent reduction since 2014. Despite declining volumes, our 2016 per-unit conventional oil operating costs were down by 10 percent from 2015 levels. We continue to focus on having a cost leader mindset which means being diligent about how we’re spending our dollars and ensuring we’ve considered the short and long-term value of every dollar spent. Our goal is to be among the lowest-cost, lowest-carbon producers.
Despite oil price volatility, we continued to contribute to the economy and to the communities near our operating areas in 2016 through royalties, donations to the community and local business development.
13 Total value of community investments = total value of company investments and external resources leveraged, audited by LBG Canada.
Industry-wide contributions to the Canadian economy
Canada’s oil sands industry provides significant economic benefits to Canada including:
- Royalty payments: For the seventh fiscal year in a row, bitumen royalties were the largest contributor to provincial resource royalty revenue. In 2015-16, revenue from bitumen royalties accounted for $1.2 billion, or about 44 percent of the non-renewable provincial resource revenue of $2.8 billion. Conventional crude oil royalties contributed $689 million, about 25 per cent of the non-renewable resource revenue in 2015-1614
- Employment opportunities: In 2016, the oil and gas industry contributed 61,000 jobs in Canada15
- Investment in suppliers: In 2015, over 2,000 companies from across Canada had direct business (goods and/or services) with the oil sands16
- Investment in Aboriginal companies: In 2013 and 2014, more than 300 Aboriginal companies from across Alberta had direct business (goods and/or services) valued at $4 billion with oil sands operators. These companies represent 54 communities across Alberta17
14 Source: The Alberta Department of Energy’s 2015-2016 Annual Report
15 Source: The Conference Board of Canada’s Canadian Industrial Outlook: Oil – Winter 2017
16 Source: CAPP The Facts on Canada’s Oil Sands
17 Source: CAPP Canada’s Oil Sands