Over the past three years Canada, and specifically Alberta, have seen an unprecedented exit of capital. This has been caused by several factors – topping the list of course is the collapse of oil prices.

With today’s announcement that both Shell and Marathon Oil are by and large exiting the oilsands play, the trend of foreign owned energy companies decamping from Albertan energy assets continues.

Today’s blockbuster deal comes on the heels of other noteworthy divestitures from Alberta energy assets as well. In the fall of 2016, Shell sold close to $1.4 billion worth of Deep Basin and Montney assets to Tourmaline. In December, Statoil announced it was selling its Thermal Oil assets to Athabasca Oil Corp, and shortly thereafter, Koch Oil Sands sent a letter to Alberta’s Energy Regulator requesting the cancellation of a SAGD project on account of the province’s burdensome red tape and carbon tax.

Of course the entire oil industry has been hit the hard, but why have multinationals left Alberta and western Canada when, concurrently, they have maintained (and in some cases increased) operational activity in other parts of the world? There are three reasons for this: higher operating costs, limited access to markets for their product and an unfriendly political climate.

And as a reminder, before breaking these three factors down, lets list some examples of multinational oil companies who have either left or substantially reduced their exposure in western Canada.

Interesting Read…

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