Editorial: December 2014
As nice as it has been to see prices at the gas pumps below $1.20 in Ontario for the first time in a long time, I think we must spare a thought for our friends in Alberta.
By Patrick Flannery
As nice as it has been to see prices at the gas pumps below $1.20 in
Ontario for the first time in a long time, I think we must spare a
thought for our friends in Alberta. The International Energy Agency is
warning if prices for crude drop below $80 a barrel, around three per
cent of the world’s oil projects will become unprofitable. Most of those
would be in Norway, Brazil, Angola…and Canada.
Alberta has been riding an incredible wave of investment and activity
ever since oil went over $100 a barrel in 2007 and has bounced around
that mark ever since. The oil sands have been particularly beneficial to
the western rental industry, with their seemingly endless appetite for
portable everything: power, light, toilets, waste disposal – you name
it. The resulting boom has transformed the economies of Alberta and
Saskatchewan and tilted the whole economic landscape of Canada away from
Ontario and Quebec and toward the West. In our sector, we are seeing
emerging dynasties as the aggressive and well-leveraged are snapping up
smaller competitors as fast as they can and growing their businesses at
triple-digit paces just to keep up with demand.
Any story of such aggressive growth is going to end with a slowdown and
correction. Some relief from high energy prices would certainly be
welcome here, where manufacturing has retreated since the last recession
and taken a lot of well-paying jobs with it. But the strengthening
American economy is going to perk Ontario and Quebec up. I’d rather see
strong demand prop oil prices up to where the oil sands are still viable
and leave the West with a gentle slowdown instead of a crash. This
country needs its eggs in more than one regional basket, and a roaring
oil-powered engine in Alberta helps us all. Some enterprising Ontario
rental operators and suppliers have been able to turn Alberta’s boom
into an opportunity of their own. Look at Mississauga, Ont.’s, L.M.
Temperature Control, which is offering commercial drying services in the
oil fields. I was chatting with Neil Courneya of London, Ont.-based
Hy-Cor the other day and he was telling me about exhibiting at the Oil
Sands Trade Show back in September. Maybe more of us should be going
where the action is instead of waiting for it to come to us.
Speaking of going where the action is, are your plans in place to attend
your regional trade show this season? It is difficult to overstate the
importance of your support for these shows. Maybe you aren’t shopping
for anything right at that moment and maybe you aren’t sure you are
going to see anything new, but taking a couple hours to pop in and
cruise the show floor is always a good idea if only to ensure that the
show will be there again for when you do need and want it. I’ve worked
in industries where the shows weakened and went away, and I can assure
you that people in those sectors were not happy about it. Thankfully,
this is not a risk for the Canadian Rental Association’s shows at
present, but I encourage everyone to do their bit and come on out to
keep the events strong and lively.
When you a get a chance, please take a look at our Twitter feed. Twitter
is slowly but surely getting stronger as a source for industry news. It
is great to be able to browse a list of relevant, quick-hit headlines
and choose whether or not to read more.
Holiday greetings to everyone! Send me a photo from your store’s holiday
party and I’ll make an album on the Canadian Rental Service Facebook