Thank you very much, Mr. Chair. Good morning, everybody.
I would like to speak specifically to an analysis that we've completed of the economic benefits, particularly for Canada's manufacturing sector, of the oil sands developments and investments in the oil sands, although I'd be more than happy to comment or answer questions on any other aspect of the economic benefits of resource or energy development, particularly for manufacturing.
The analysis that we've completed is based on Statistics Canada's input-output analysis. It's based not on economic projections of projects under way, but on projects that we know are approved or under construction right now. More than anything else, it's based on 10 years' experience that we've had in trying to connect manufacturers across the country with the opportunities of oil sands development.
Canadian manufacturing sales are closely related to investment in oil sands projects as well as the operating expenses that these projects incur once they're under way. I want to point out that oil sands are a bit different from other oil and gas operations in that they're manufacturing operations. They continue to produce and they continue to generate demand for products and services as they run—for maintenance, repair, and other operating expenses. So demand for manufactured products is driven both by new project investments as well as by continuing maintenance, repair, and operating expenses.
I believe the executive summary of our report has been distributed to members of the committee. The full report, of which I'm going to just point out some highlights, is available on www.cme-mec.ca. I just want to point out a couple of highlights of the report.
One of the things we've found is that demand for manufactured products, both imported and from Canada, has been pretty stable over the past 10 years. It's not that difficult to try to project forward what the demand will be. Some of our findings are that for every dollar of new investment in new projects in the oil sands, 62 cents is spent on manufactured products, out of which 28 cents is derived from domestic manufacturing, and 34 cents from goods that are imported into the country. Every dollar in maintenance, repair, and operating expenses generates about 30 cents in demand for manufactured products, out of which 16 cents comes from domestic manufacturing and 14 cents from imported products.
The types of manufacturing products that are in demand on oil sands projects extend from heavy equipment—construction, mining, and excavation equipment—to heavy transportation equipment, and everything that's used in that equipment, from structural steel to the tubes, pumps, and valves that are part of the infrastructure not only of the oil sands projects, but also, as I said, the continuing maintenance and repair and operation. So the demand really covers almost every sector of manufacturing operations.
Let me give you some quick statistics. In 2012, the last year for which we have full statistics, $49 billion was invested in oil sands projects, $28 billion in new investment, and that generated $7.6 billion in demand for manufactured products from Canada. Twenty-one billion dollars was spent in maintenance, repair, and operations, and that generated demand for $2.9 billion dollars in manufactured goods from within Canada. The overall impact was $10.5 billion, and that is the equivalent of 105,000 person-years of work. A lot of that was captured within western Canada, about 66% from Alberta and Saskatchewan, but almost 10% was from Quebec, and 14% to 15% from Ontario. The Atlantic provinces were involved, particularly in fabricated metals.
So this really is of national significance.
In fact, over the past 15 years, from 1997 to 2012, over $300 billion has been invested in oil sands projects, with $173 billion in new projects or new investments and $118 billion in maintenance and repair in operations. In total, that generated demand for $64 billion of domestically produced manufactured goods, and that's about the equivalent of 640,000 person-years of work.
Based on projections going forward up to 2013—and there is a range of these projections—we're looking at somewhere between $972 billion and $1.8 trillion of new investment in oil sands up to 2030. If that is the case, then we'd be generating $211 billion to $387 billion of demand for domestically generated manufactured goods, and that's the equivalent of 2.1 to 3.9 million person-years of work.
Those are all numbers that can be found in the report, but let me point out just a couple of things very quickly. That does not include the services that are also generated to repair or to maintain the products that are being purchased by the oil sands projects. There's a huge array of services around this as well. It doesn't include the additional benefits from expanding downstream operations in terms of upgrading or refineries. That's a sector that already generates about $2.5 billion and about 100,000 jobs in Canada in value added. It doesn't include the economic benefits of having cost-competitive fuel for the entire Canadian economy. And it doesn't include the benefits of the infrastructure or the public services that are paid for as a result of the taxes paid by oil sands operations. So this is really only looking at demand for manufactured products in the oil sands themselves.
As I say, I don't think the numbers tell the full story either. First of all, if it were not for the oil sands, the downturn that we saw in manufacturing would have been much more severe than it was. The oil sands probably saved about 100,000 jobs between 2008 going into 2009 and 2010 in the recession. It also doesn't tell the story about the innovation that's being driven and the technological development that's being driven as a result of the need to develop new products and new technologies for the oil sands. Companies are taking those technologies and today have the capability not only to supply oil sands development but also to take those international as well.
There are a lot of constraints: skills, infrastructure, regulations that impede cross-border trade within Canada, innovation.... All of these things need to be a focus of government policy. We can talk about those in a minute, but I don't think we should take our eye off the value and the jobs and the potential for overall economic growth that can be generated as a result of this fabulous resource in Canada.
Thank you.