Environmental Technology Advancement Corp., Council of Canadian Academies champion investment in practical innovation

Canadian oil and gas R&D spending tops $385 million in 2009

By Gordon Jaremko

February 05, 2010

Writing its report on the heels of the global credit and energy price slumps, the scholarly panel sounds a warning. The events of 2008-09 highlighted the vulnerability to external economic forces that reliance on natural resource extraction creates for national business, employment and living standards.

“Canada’s experience shows that natural resources can make a region wealthy so long as supply lasts, prices are strong and environmental costs are acceptable. But these favorable conditions may be unsustainable or out of a nation’s control.”

The experts recommend a national strategy of encouraging forays into newer fields and especially ICT, the buzz code for information and communications technology. But there is also an admission that the older mainstays are fertile fields for creativity. “Resource production itself requires continuous innovation to increase efficiency, extend supply and mitigate environmental impacts.”

Work on improving technology is a big ticket item in the petroleum industry, show Statistics Canada records on business enterprise research and development. Between 2000 and 2009, companies in oil and gas extraction, contract drilling and related services spent an annual average of $328 million in this field, known as BERD for short.

The true extent of research and development expenditures generated by the energy industry is much higher if its role as an engine for the overall economy is taken into account. “In Alberta, R&D related to oil and gas activities accounts for much of the growth in the manufacturing and services industries,” Statistics Canada observed in a separate special study of the province.

Total Alberta business research and development spending grew by 53 per cent from $509 million to $779 million during 1994 through 2003, the study found. The national growth rate for the same period was a faster 77 per cent but included fields that are barely represented in the energy province such as motor vehicle and aircraft manufacturing. In 2007, the last year for which complete records are available, 1,343 Albertans had full-time careers in research and development for oil and gas extraction and mining. Industrial and business creativity plainly has a role in the resource sector.

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