Canadian oil sands woes reach far-flung eastern shores

Thu Mar 19, 2015 6:06am EDT
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By Greg McNeil

SYDNEY, Nova Scotia (Reuters) - Cory Troke joined the exodus west two years ago, leaving scenic but job-scarce Cape Breton, Nova Scotia, after being laid off as a machinist.

Troke, 37, headed to the Alberta oil sands, apprenticing as a pipefitter and finding 19 months of steady work, flying in for two weeks, returning home for one.

By October Troke was out of work again, and he was not alone. A downturn driven by tumbling crude prices is causing turmoil in an island economy that has grown dependent on workers commuting more than 3,000 kilometers (1,860 miles) west.

"I personally know 40 to 50 guys that have been laid off since October," says Troke.

Cape Breton is another example how the 60 percent slide in oil prices since last June has rippled far and wide, affecting property markets in Alberta and North Dakota, helicopter sales in Houston, the Canadian dollar and national interest rates.

Once an industrial powerhouse fueled by now-closed coal mines and steel mills, the island has turned into an exporter of labor. Many young workers head to Fort McMurray in northern Alberta, lured by big paychecks awaiting at oil sands projects clustered around the city.

"If we didn't have the oil sands, the McMurray factor as we sometimes call it, we would be in economic chaos," said Cecil Clarke, mayor of the Cape Breton Regional Municipality.

Clarke, who has a brother working in Fort McMurray, says there is no precise data on the number of Cape Breton residents working in Western Canada, but pegs it at around 10,000. Other think it is closer to 5,000.   Continued...