February 2018 edition

This module provides a concise summary of selected Canadian economic events, as well as international and financial market developments by calendar month. It is intended to provide contextual information only to support users of the economic data published by Statistics Canada. In identifying major events or developments, Statistics Canada is not suggesting that these have a material impact on the published economic data in a particular reference month.

All information presented here is obtained from publicly available news and information sources, and does not reflect any protected information provided to Statistics Canada by survey respondents.

Resources

  • Calgary-based Encana Corporation announced its 2018 capital program is expected to be between USD $1.8 billion and $1.9 billion and that approximately 70% of the program will be focused on growing oil production from the Permian and condensate production in the Montney. The company said its capital expenditures in 2017 were USD $1.796 billion.
  • Calgary-based Imperial Oil Limited announced its 2018 capital expenditures are expected to range between $1.5 billion to $1.7 billion. The company said its 2017 capital and exploration expenditures totalled $671 million. Imperial also said that planned investment aimed at increasing annual average gross production at Kearl to 240,000 barrels per day is expected to be completed by year-end 2019.
  • Calgary-based TransCanada Corporation announced it expects to spend approximately $9.0 billion in 2018 on growth projects, maintenance capital and contributions to equity investments, with the majority of its anticipated capital program focussed on U.S., Canadian and Mexico natural gas pipeline growth projects. The company said its 2017 capital spending was $9.21 billion. TransCanada also announced it will move forward with a $2.4 billion expansion of its NGTL System to connect incremental supply and expand basin export capacity by one billion cubic feet of natural gas per day at the interconnection with its Canadian Mainline. The company said NGTL anticipates filing a project description with the National Energy Board by the second quarter of 2018 to initiate the regulatory review process for the expansion, and that, subject to regulatory approvals, it expects construction to begin in 2019.
  • Calgary-based Enbridge Inc. announced its total capital expenditures for 2017 were $8.287 billion. The company had previously announced that its capital expenditures for 2018 would be approximately $9.0 billion.
  • Calgary-based Inter Pipeline Ltd. announced its planned 2018 capital expenditure program will be $950 million. The company said its capital expenditures in 2017 were $400.5 million.
  • Calgary-based Pembina Pipeline Corporation announced its capital expenditures in 2017 were $1.839 billion. The company had previously announced its capital program for 2018 would be approximately $1.3 billion.
  • Vancouver-based Teck Resources Limited announced its capital expenditures in 2018 are expected to be $2.120 billion. The company said its capital expenditures in 2017 were $2.299 billion.
  • Calgary-based MEG Energy Corp. announced that it had entered into an agreement with Wolf Midstream Inc., also of Calgary, for the sale of MEG’s 50% interest in Access Pipeline and 100% interest in Stonefell Terminal for $1.61 billion. MEG said the transaction is expected to close in the first quarter of 2018, subject to regulatory approvals and customary closing conditions. MEG also announced it intends to increase its 2018 capital budget from $510 million to $700 million.
  • The Government of British Columbia announced it will be moving forward with consultation around four bitumen spill safeguards, as announced in January, while referring to the courts the outstanding issue regarding restrictions on the increase of diluted bitumen transportation.

Finance and insurance

  • Toronto-based Choice Properties Real Estate Investment Trust and Canadian Real Estate Investment Trust (CREIT), also of Toronto, announced an agreement pursuant to which Choice Properties will acquire all of CREIT’s assets and assume all of its liabilities in a transaction valued at $6.0 billion. The companies said they anticipate the transaction will be completed in the second quarter of 2018, subject to compliance with the Competition Act, unitholder and court approvals, as well as certain other customary closing conditions.
  • Toronto-based Scotiabank and Jarislowsky Fraser of Montreal announced that Scotiabank will acquire Jarislowsky Fraser for approximately $950 million. Scotiabank said the transaction is expected to close in fiscal Q3 2018, subject to regulatory approvals.
  • Toronto-based Fairfax Financial Holdings Limited and Carillion Canada Holdings Incorporated of Concord, Ontario, announced they had entered into an agreement pursuant to which Fairfax will acquire certain assets and assume certain liabilities related to Carillion’s Canadian operations. The companies said the transaction is expected to close in the first quarter of 2018, subject to customary closing conditions, including approval by the Ontario Superior Court of Justice in Carillion Canada’s proceedings under the Companies’ Creditors Arrangement Act, regulatory approvals, and the satisfactory completion of due diligence by Fairfax.

Other news

  • The Government of Canada tabled Budget 2018 on February 27th, which included new funding to support science and innovation; new investments to improve the quality of life for Indigenous Peoples; and measures to increase the labour force participation of women and address the gender wage gap including a new Employment Insurance Parental Sharing Benefit. The Government forecasts an $18.1 billion deficit for 2018-2019 and real GDP growth of 2.2% in 2018.
  • The Government of New Brunswick tabled its 2018-19 provincial budget on January 30th, which includes an additional $73 million in new targeted investments to support economic competitiveness, youth employment and seniors. The Government forecasts a $189 million deficit in 2018-19 and real GDP growth of 1.1% in 2018.
  • The Government of the Northwest Territories tabled Budget 2018-19 on February 8th, which includes $21 million in new investments to support the economy, environment and climate change resilience and adaptation; education; community wellness; cost of living support; and governance. The Government forecasts a $23 million operating surplus in 2018-19 and an economic contraction of 0.1% in 2018.
  • The Government of British Columbia tabled Budget 2018 on February 20th, which included a new tax on housing speculation, an increase in the foreign home buyers tax from 15% to 20% effective February 21, 2018, and increased spending on child care as well as investments in affordable housing, education and health care. The Government forecasts a $219 million surplus in 2018-19 and real GDP growth of 2.3% in 2018.
  • The Government of British Columbia announced it will raise the province’s minimum wage from $11.35 an hour to $12.65 an hour on June 1st. The Government said additional increases will take place on June 1st of each year for three more years and that, by June 2021, the province’s minimum wage will rise to at least $15.20 an hour.
  • The Government of New Brunswick announced it will increase the minimum wage from $11.00 per hour to $11.25 per hour on April 1st. The Government also said the minimum wage will be indexed to the corresponding increase in the New Brunswick consumer price index.
  • The Government of Newfoundland and Labrador announced it will raise the minimum wage from $11.00 per hour to $11.15 per hour effective April 1st, 2018, and that future increases will take effect April 1st of each year and be based on the percentage change in the National Consumer Price Index.
  • The Government of Canada announced proposed changes to environmental laws and regulations related to the review of major natural resource projects. The proposed changes include:
    • increasing public participation in project reviews;
    • ensuring decisions are based on robust science and Indigenous traditional knowledge;
    • replacing the Canadian Environmental Assessment Act, 2012, with the Impact Assessment Act, and extending the types of impacts studied;
    • establishing the Impact Assessment Agency of Canada (currently the Canadian Environmental Assessment Agency) to lead all federal reviews of major projects;
    • reducing timelines for project reviews compared to the current system; and
    • amending the Fisheries Act, including expanding protections under the Canadian Navigable Waters Act.
  • The Government of Alberta announced support for full-scale commercialization of partial-upgrading technologies as part of its strategy for energy diversification. The Government said it will support up to $1 billion for full-scale commercialization of partial-upgrading technologies over eight years beginning in 2019-20, which will include a variety of fiscal tools including loan guarantees and grants.
  • Illinois-based Motorola Solutions Inc. announced it had entered into a definitive agreement to acquire Avigilon Corporation of Vancouver for an enterprise value of USD $1.0 billion including Avigilon’s net debt. The company said the transaction is expected to be completed by the end of the second quarter of 2018, subject to customary closing conditions, including regulatory, shareholder and court approvals.
  • San Francisco-based Salesforce.com, Inc. announced it plans to invest USD $2.0 billion over the next five years to increase its headcount, real estate footprint and data centre capacity in Canada. The company said it currently employs more than 1,300 employees in Canada.
  • The U.S. Department of Commerce (DOC) announced the initiation of antidumping duty (AD) and countervailing duty (CVD) investigations of imports of large diameter welded pipe from Canada, China, Greece, India, Korea, and Turkey. The DOC said the estimated dumping margin alleged by the petitioners is 50.89% for Canada. The DOC also said the U.S. International Trade Commission is scheduled to make its preliminary injury determinations on or before March 5, 2018.

United States and other international news

  • The Bank of England's Monetary Policy Committee maintained the Bank Rate at 0.50%, and the stock of UK government bond purchases, financed by the issuance of central bank reserves, at £435 billion. The last change in the Bank Rate was a 25 basis-point increase in November 2017.
  • The Reserve Bank of Australia maintained the cash rate at 1.50%. The last change in the cash rate was a 25 basis point reduction in August 2016.
  • The Reserve Bank of New Zealand left the Official Cash Rate, its main policy rate, unchanged at 1.75%. The last change in the Official Cash Rate was a 25 basis point reduction in November 2016.
  • Sweden's Riksbank left its main interest rate, the repo rate, unchanged at -0.5%. The last change in the repo rate was a 15 basis point cut in February 2016.

Financial market news

  • Crude oil (West Texas Intermediate) closed at USD $61.64 on February 28th, down from $64.73 at the end of January. The Canadian dollar closed at 78.07 cents U.S. on February 28th, down from 81.35 cents U.S. on January 31st. The S&P/TSX closed at 15,442.68 on February 28th, down from a closing value of 15,951.67 at the end of January.
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