This is a case of following the money. If you want to get a feel for how an industry segment is feeling about its prospects, track how much it is investing in long-term assets. The most recent one in Saskatchewan is in the oil patch.
Even in the face of additional federal regulations on emissions generated by oil and gas production in this part of the country, industry players continue to show their confidence in the business by ramping up their investment levels.
The provincial government has just completed the fifth of six sales of drilling rights in the province for this fiscal year. The industry forked over $17 million for the right to drill, principally in the Estevan area followed by activity around Lloydminster and then Kindersley.
That brings the total generated by the government so far this fiscal year to $65 million, almost 50 per cent higher than the bids they received by this time a year ago. In other words, the industry is doing the exact opposite of pulling back. It is increasing its long-term investment in production.
