CALGARY (Reuters) - Canada’s energy heartland is showing a spark of optimism at the Calgary Stampede, an annual rodeo and corporate networking destination, with party sizes and event attendance on the rise as oil prices claw up from the 13-year lows of 2016.
Oil and gas producers, who laid off thousands of workers and slashed millions in capital expenditures after prices began their sharp descent in 2014, are slowly increasing their spending at the 10-day festival that runs to July 15.
In a sign the sector is still feeling the effects of tough times, many of the new sponsors for the Stampede’s key Canvas Auction were from outside of the energy sector.
“We are seeing a bit more activity the last couple of years. It’s a slow recovery, a very cautious recovery,” said Gregg Scott, president of Scott Land & Lease Ltd, which acquires land for oil and gas companies.
For more than 20 years, energy companies have been footing the bill on annual parties for clients and staff during the Stampede, while guests often contribute to designated charities.
After U.S. crude oil futures prices CLc1 tumbled more than 70 percent over 1-1/2 years to a 13-year low at $26.5 per barrel in 2016, Stampede budgets tightened up.
Prices have since tripled to around $73 per barrel, a marked improvement but still around 50 percent below the highs of 2008.
Scott’s Stampede party rose to 800 people this year, up from 600 in 2016, a sign of increased company spending at its 21st consecutive event.
“This year is a better year but I think people are still cognizant of what has happened in the past,” said Codey McCurrach, 43, an energy company employee who is racing a four-horse chuck wagon in the Stampede.
At Cowboys, an establishment that hosts parties next to Stampede grounds, daytime party bookings are down 80 percent from 2012, said Paul Vickers, president and chief executive of Penny Lane Entertainment Group, a majority owner of Cowboys.
The Stampede itself has seen an uptick with first-day attendance at a record 122,403 people on July 6, up 38 percent from the five-year average.
Earlier this year, money raised through the Calgary Stampede Canvas Auction – a de facto litmus test on the state of the economy that auctions sponsorship for the 10-day chuck wagon races - rose to C$3.2 million ($2.45 million).
This was up 34 percent from 2017 and the highest in the last four or five years, said Theresa Howland, director of marketing, communications and sponsorship for the Calgary Stampede.
“The energy sector was, and still is, in the midst of a prolonged downturn,” said Jim Davidson, deputy chairman of GMP FirstEnergy Capital and founder of FirstEnergy.
($1 = 1.3079 Canadian dollars)
Reporting by Marcy Nicholson; editing by Jonathan Oatis