Just 7.5% of their capital budget will be in Canada.
Enerplus – a Calgary based energy company – is cutting their capital spending in Canada in 2019.
In 2018, 10% of their capital budget was allocated for Canada. That’s going down to 7.5% in 2019, representing a 25% cut in their Canada capital spending.
As a result, the share of Enerplus capital spending in the United States will be going up.
As noted by BNN Bloomberg, “The decline in Enerplus’ capital expenditure on its home turf comes as Canada’s energy sector struggles with low oil and gas prices, and concerns over regulatory uncertainty.”
Here’s what their CEO Ian Dundas said in a statement:
“Our 2019 plan is expected to generate double-digit returns on capital employed and competitive oil production per share growth while operating within cash flow based on prevailing commodity prices. Importantly, if we see commodity prices improve, we would expect to generate meaningful free cash flow.”
Previously, Dundas had said, “For people to think about deploying capital into Canada, I think you’re looking for things to start to get better – and that really hasn’t been the pattern. It’s been getting worse.”
This is a direct result of the Trudeau economy: The carbon tax, and excessive bureaucratic regulations is having a devastating impact on the energy industry and on Canada’s economy.
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