Alberta's downturn after many boom years tied to dramatic fall in oil price

THERE ARE bumper stickers on cars in the Canadian province of Alberta that say: “Oh Lord, give me another boom – I promise not to waste it.”

The province’s minister for finance and enterprise, Iris Evans, who visited Dublin this week seeking investors into Canada, said that Alberta had, like Ireland, experienced a sharp downturn in its economy after several boom years and that Albertans lamented the passing of the boom.

The province had the highest economic growth rate in Canada – 4.7 per cent – over the past five years and is expecting growth of almost 1 per cent this year when other provinces are forecasting negative or modest growth.

There are striking parallels between Ireland and Alberta.

Just as property fuelled the Irish boom, one sector – energy – drove economic growth in Alberta.

The province’s oil sands, a type of bitumen deposit, became highly valuable in recent years as higher oil prices and new technology enabled Alberta to extract fuel profitably and convert it to products.

Ms Evans said Alberta’s oil sands sat under 140,000 sq km, about double the size of Ireland, and that just 500 sq km had been tapped. “It’s the equivalent of a Smart car on one of your soccer fields,” she said. “There is a world of opportunity out there.”

Alberta stretches from the 49th parallel, which marks the border with the US and the state of Montana, to the 60th parallel in the north. The province has a population of 3.5 million, of whom 540,000 claim Irish heritage.

The fall in oil prices has hit Alberta hard. A barrel of oil has fallen from $147 last July to less than $40. Rough economic times had presented challenges, Ms Evans, said and Alberta would incur “a technical deficit” this year.

“We have got a situation where we are going to be struggling to make ends meet,” she said. “Just like Ireland is losing jobs at a very rapid rate, the volatility of an energy-dependent economy is such that we have to pay due care and watch our spending.”

However, Ms Evans said Alberta still attracted investors, although the main challenges facing them is the high cost of building materials and the availability of labour. Alberta has the lowest unemployment rate in Canada.

“It is not difficult for us right now because in Alberta there is such interest in our 173 billion barrels of proven reserves for oil.

“It is probably the safest and more secure sources of fossil fuels in the entire free world – there is no doubt we are attractive until somebody finds an alternative.”

Ms Evans said she hoped investors would “see some hope in Alberta and Canada for opportunities”, despite the economic difficulties. “What’s most difficult is to manage the expectations of a population who have been living on top of the bubble and who have to reduce that expectation.”