Government Spending on Canada’s Oil and Gas Industry

The Pembina Institute
January 31, 2005

Governments in Canada, as well as elsewhere, subsidize a number of socially beneficial services. These include, for example, health care, education and energy services. To the extent that subsidies provided to the energy sector are for oil and gas developments, however, they are contributing to increased environmental impacts and hindering developments of environmentally friendly alternative energy options. The purpose of this study is to investigate government expenditure on the oil and gas sector in Canada. To that end, we identify and document the various forms of public support provided to this industry by the federal government. We focus on federal government support provided through grants (direct expenditure), the tax system (tax expenditure) and government departments (program expenditure) for conventional oil and gas as well as for oil sands between 1996 and 2002.