Slip in oilsands expansion worries Newfoundland mayor

There may be thousands of kilometres between Alberta's oilsands and the southern Newfoundland town of Marystown, but Mayor Sam Synard is still keeping a close and increasingly anxious eye on a possible downturn in that province's oil fortunes.

Major energy companies, including Suncor Energy, Petro-Canada and UTS, have announced they are delaying projects or cutting spending on oilsands work, in response to the spiralling global credit crisis.

Thousands of workers from Newfoundland and Labrador commute to jobs in Fort McMurray and other communities in Alberta's oilpatch, to such an extent that what experts call the "receipt economy" is guiding the fortunes of many towns in the province.

"I would say more people depend on work in Fort McMurray from our immediate area than there are jobs on the Burin Peninsula to begin with," Synard told CBC News on Monday.

Synard estimates that about 1,000 workers in and around his town of 5,400 work in the oilsands, while retaining their permanent Newfoundland homes.

Synard said he understands the risks.

"We're dangerously dependent on the oil industry in Alberta for employment opportunities on the Burin Peninsula," said Synard, adding other towns and cities are in the same boat.

"The mayor of Stephenville will say it, the mayor of Corner Brook, every mayor in the province will say [that] our community is stronger economically than ever before," Synard said.

"I think we need to take a second deep breath when we make that comment and really be cognizant of the fact [of]why that is. And it's not because we've done such a great job locally or provincially, it'sbecause we're so lucky that Alberta has done so well the last five or six years."

It's difficult to determine how many workers from Newfoundland and Labrador rely on employment in Alberta's oil industry. Some analysts have estimated as many as 10,000 people.

The trend has had numerous repercussions, including a labour shortage particularly skilled trades people that spans most industries.

Synard said, though, that local economies could feel the pinch if the oilsands industry scales back.

"We are hearing stories about people having to wait to go back to work. We're hearing about young people with no seniority, just coming out of college, finding it a little bit more difficult to get work," he said.

"Our more senior people are well entrenched in the industry and they'll be some of the last people to leave the worksite hopefully."