One of the worst downturns in recent history in northeastern B.C. began to turn around in the latter part of 2016, thanks in part to the construction of Site C dam, the reopening of idled coal mines, a resurgence in oil and gas activity and strong lumber prices.
But that recovery will depend on a “much needed revival of the resource sector,” warns the Chartered Professional Accountants of BC (CPABC).
Unemployment in the Peace region hit 9.7% last year – the highest in 15 years, says the CPABC.
"This was due to 1,000 job losses and an increase of 1,700 unemployed people in the region,” Ben Sander, a partner at Sander Rose Bone Grindle LLP in Dawson Creek, said in a CPABC press release.
“In addition, delayed investment decisions in oil and gas projects have worn away any optimism about the near-term future of our economy."
Major project investments in the region fell by 2.8% last year. Even so, those investments still totalled $37.4 billion. A significant amount of that investment was by oil and gas companies, which have been investing in new gas processing plants in the Peace region.
A total of 2,900 jobs were lost in the Peace region in 2016, but were made up in the latter half of 2016 with the reopening of two idled coal mines, construction work on Site C dam and a resurgence in oil and gas activity.
Of the 1,300 new jobs created by the forestry, fishing, mining, oil and gas industry in 2016, half were created by the oil and gas industry, the CPABC says.
"As regional service hubs with the most diversified economies in the region, both Fort St. John and Dawson Creek have seen job creation from activities on Site C and the Montney Formation projects, as well as construction on a number of smaller infrastructure investments," Sander said.
“The reopening of two coal mines late last year also restored some jobs in the communities of Tumbler Ridge and Chetwynd."
He referred to the restarting of metallurgical coalmines in Chetwynd and Tumbler Ridge. Last year, an American company, Conuma Coal Resources Ltd., restarted two of the three idled B.C. mines that it acquired from Walter Energy, which went bankrupt.
The region’s ongoing recovery could be jeopardized by commodity prices and softwood lumber duties.
"Improved commodity prices should help recover some of the jobs lost last year,” Sander said. “However, it may be a while before our economy fully bounces back. The U.S. tariff on softwood lumber, as well as uncertainty over natural gas prices and trade negotiations with the U.S. and other countries will continue to dampen our economic outlook for the foreseeable future."