Alberta’s oil patch dials down Calgary Stampede celebration

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Corporate Calgary has lost much of its swagger, and nowhere is that more on display than the Stampede party scene.

During the annual fair that takes over the city beginning next week, some of the most sought-out networking events have been cancelled. For those Stampede-themed parties that remain on the calendar, rambunctious, ostentatious displays of wealth are out. Beef-on-a-bun, beer-in-a-plastic-cup, charity-minded gatherings are in.

If not quite sober, a more sombre mood prevails in the Stampede city, where a two-year oil price rout has seen corporate profits drop and insolvencies jump. In 2016 alone, Alberta has shed about 35,000 jobs and its unemployment rate rose to 7.8 per cent in May. Many Albertans are still reeling from the massive wildfire that tore through parts of Fort McMurray in May and threatened oil sands production.

Even if firms can still afford to host a party, many are choosing not to while the layoff notices continue.

"It's hard to be out there celebrating when many of our clients have significantly reduced cash flows and staffing," said Peters & Co. Ltd. chief executive Christopher Potter, in explaining why the investment bank has cancelled its popular Firewater Friday soiree this year.

"It was a very difficult decision given that it's been such a mainstay in the Calgary community the first Friday of Stampede."

Mr. Potter said the annual party has been held for more than four decades and typically hosts 1,000 people. Firewater Friday could return in 2017, he said, "with hopes of better times for Alberta."

For downtown Calgary, July's two weeks of Stampeding is not about regular office work – it's about dressing cowboy, schmoozing and boozing, and getting invited to the most exclusive corporate parties. The private gatherings have long been seen as venues where movers and shakers can relax and build relationships to ease business transactions the rest of the year. Politicians of all stripes are also regulars at the white-tented events.

Oil prices were low last year, too. But the Stampede party slide is being felt even more this year.

During the 2015 Stampede, momentum and early venue bookings meant that many events were still a go. This year, many companies had to make a decision on whether to host a party during the dark months of December and January, when crude prices hit record lows.

The closer you get to the oil patch, the more likely a Stampede event has been cancelled. For instance, Cenovus Energy Inc. cancelled its staff celebration and some of the Stampede entertaining activities last year. Major venues such as the Stampede grounds and Heritage Park report that party numbers are down. Event planners say the budgets for the functions that are proceeding are being kept in close check.

"They're definitely smaller," said Jocelyn Flanagan of e=mc2 events, one of the city's largest event planners. "It's maybe not even about affordability; it's about perception."

While this year might be an anomaly, Stampede party levels have been trending downward since Burnet, Duckworth & Palmer LLP cancelled its event in the midst of the 2009 global financial crisis.

There was a bump in the number and scale of parties while oil prices went higher again between 2011 and 2014, but it didn't reach the levels seen in boom years like 2006 and 2007 – when many firms were in a race to see who could invite the most people to dine on the biggest prawns and drink the finest grogs.

And others have since followed BD&P's example. Osler, Hoskin & Harcourt LLP cancelled its party last year. Oil-patch financier Jim Kinnear's splashy event at his Mount Royal house, which one year featured his initials branded into each hamburger bun served, is off for the second year in a row. "It wouldn't be sending the right message," Mr. Kinnear said in an interview.

The Big Guns Stampede breakfast came close to being cancelled in this, its 18th, year, said organizer Darryl Fushtey of Scott Safety Supply Services Inc. But changes to the venue, other cost savings and a focus on raising money for the food bank breathed new life into the 5,000-person event – which features a morning concoction of orange and pineapple juice with vodka – hosted by a group of oil field service companies.

But even in the downturn, some new parties are starting up. Reality TV star and Prairie Merchant Corp. chairman Brett Wilson last year created Prairie Rowdy – a play on his beginnings with FirstEnergy Capital Corp. and the name of the event hosted by the investment bank until it, too, was cancelled this year. Mr. Wilson said PrairieRowdy is a go again this year, and many companies that have cancelled their soirees are missing an opportunity.

"If the purpose of the celebration is a gathering, and you dial down the alcohol and you don't bring in the super-expensive band, you don't serve steak, you serve – what we called when I was growing up – tube-steaks, or hot dogs and sausages, we can adapt to the times. We don't run away from the times," he said.

Event organizers also report that venues once booked by energy players are now being booked by companies in the transportation, technology and entertainment sectors. Real estate firms, which have seen their Alberta business drop but thrive on transactions with clients, are making a keen effort to keep the party going.

Greg Kwong, regional managing director for CBRE Canada, said the size of the commercial real estate firm's Stampede celebration will be the same as last year, with about 350 clients and staff. But "we're cutting out a lot of the extravagances of the party." There will also be a strong charitable element this year, with money saved from party cost-cutting going to the Calgary Women's Emergency Shelter.

"We're just having it because I think it's important to keep the morale up," Mr. Kwong said, adding that the Calgary Stampede and the western culture it represents is part of the fabric of the city.

And as oil prices have moved closer to $50 (U.S.) a barrel in recent weeks, there have been a number of last-minute party bookings.

"There's sort of a renewed feeling of optimism," said Ms. Flanagan of e=mc2 events. "Not glowing optimism, but a sense that we as Calgarians still need to rally together."