Canada allocates 1,200 million dollars to help the oil sector

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Undated photo by Petro-Canada of the Petro Canada Hibernia oil platform. Canadian oil companies Suncor and Petro-Canada have announced that they have reached a merger agreement to create the largest energy company in Canada with a value of about 43.3 billion dollars (34.640 billion US dollars). EFE / Archive

The Government of Canada announced today that it will allocate 1,600 million Canadian dollars (1,200 million US dollars) to help the oil sector in the west of the country.

The aid will be channeled in the form of export loans with the objective of helping the sector of the province of Alberta, which sells practically all of its production to the United States.

In recent months, the price of oil produced in the oil sands deposits of Alberta has experienced a sharp drop due to the lack of diversification of its markets.

The Government of Alberta has been trying for years to expand an oil pipeline connecting the oil fields of the province with the Pacific coast, Trans Moutain, to sell oil to Asia and diversify its export markets.

But the province of British Columbia, indigenous communities and environmental groups have opposed the expansion of the pipeline, blocking the oil output.

In May, Ottawa announced the purchase of Trans Mountain to ensure construction of the expansion but the project remains frozen by the country’s courts.

The Government of Alberta estimates that it is losing 80 million Canadian dollars (60 million US dollars) a day due to the fall in the price of oil.

The Canadian province decided in early December to impose a 9% reduction in oil production to increase the price of a barrel of the Western Canadian Select (WCS).

Alberta has also announced the purchase of 7,000 tank cars to increase the distribution capacity of crude oil.

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