Oil sands producers spent more in 2019 than the previous two years on the procurement of goods and services from Indigenous suppliers says a recent survey by the Canadian Association of Petroleum Producers. Just under $2.4 billion was spent on procurement from Indigenous businesses in 2019, up by 16 per cent compared to 2018 and 53 per cent higher than in 2017.
The number of Indigenous-owned businesses supplying the oil sands also grew to 275 in 2019, up from 263 in 2017. Between 2017-2019, cumulative spending on procurement from Indigenous suppliers totalled about $5.9 billion.
Indigenous businesses have been an integral part of the supply chain for the oil sands for decades, providing services such as construction, transportation, camps and catering, retail, and drilling to name a few. The oil sands sector works closely with Indigenous communities in support of their overall well-being and economic security, with a focus on sourcing goods and services from Indigenous suppliers whenever possible.
In 2019, oil sands producers also invested approximately $64 million into Indigenous communities within or near operations. Of that amount, $32 million was invested into communities, $28 million into consultation funding and another $4 million into other Indigenous-led initiatives.
Community investments are often directed at supporting training programs, education initiatives, cultural programs and physical infrastructure. Some of these training programs are industry-specific, providing Indigenous Peoples with an opportunity to find a job in the nearby oil and gas sector after graduating.
The survey also found that 7.4 per cent of oil and gas workers in Canada identified as Indigenous in 2019, up from 4.8 per cent in 2018. Surely this is a testament to the success of community investments made by oil sands producers that help many Indigenous Peoples start long and fruitful careers in the sector.
Consultation funding ensures that Indigenous voices are heard throughout the lifetime of an operation by supporting project specific consultations, technical reviews, environmental studies and other related tasks.
Oil Sands Support Indigenous Peoples
The oil sands sector works closely with Indigenous Peoples in support of their overall well-being and economic security. As shown above, the industry provides substantial opportunities for Indigenous-owned businesses, entrepreneurs and community members to be a part of the oil sands supply chain and reap the benefits.
Here’s more examples of how the oil sands industry has benefited Indigenous communities:
- Between 2013 and 2016, oil sands operators spent $7.3 billion on goods and services from Indigenous suppliers
- In 2015 and 2016, $48.6 million was invested into Indigenous communities by oil sands producers
- Between 2015 and 2016, oil sands operators provided over $40 million to Indigenous communities for consultation capacity funding
- From June 1st to December 31st, 2017, $55 million in payments from conventional oil and gas activity were made to Indigenous governments in Canada
- Suncor has spent $5 billion with Indigenous suppliers since 1999
- Suncor spent $1.7 billion more on Indigenous businesses than the entire Government of Canada since 1996
- In early 2020, Cenovus announced plans to spend at least $1.5 billion with Indigenous-owned businesses over the next decade
- In early 2020, Cenovus also pledged $50 million to build homes in 6 Indigenous communities near its oil sands operations
- Since 2013, Cenovus has awarded more than 190 post-secondary scholarships to Indigenous students
- Cenovus has signed nine long-term benefit agreements with Indigenous communities located within or nearby operations
- Canadian Natural Resources Ltd. (CNRL) spent roughly $500 million with Indigenous-owned businesses in 2018, up 35 per cent
- The Fort McKay Group of Companies – 100 per cent owned and operated by the Fort McKay First Nation – provides a variety of services to oil sands companies, generating more than $150 million in revenue annually
Sources: Cenovus, Suncor, CAPP, Indian Resource Council, Government of Canada
