Oil Patch Braces for Exploration Chill After Canada's Election
- Liberals, NDP would restrict use of key tax deduction
- Industry warns against adding disincentive for investment
The Enbridge Inc. Athabasca Pipeline Twinning project stands while under construction in Hardisty, Alberta, Canada, on Friday, Dec. 6, 2013. Canadian heavy crude reached its strongest level in more than two months on the spot market as a pipeline connection to the U.S. Gulf Coast began filling with crude ahead of its startup next month.
Photographer: Brett Gundlock/BloombergAs Canada’s oil patch grapples with a price shock, pipeline delays and rising tax rates, the federal election could add another barrier to recovery by reining in a key incentive for development of new wells.
Two of the three major parties jostling for power in the Oct. 19 vote are campaigning against “fossil fuel subsidies” and propose tightening the rules for a tax deduction that allows oil-and-gas producers to write off exploration costs against profits entirely in the year they’re incurred.