The taxpayer's Canadian employer provided the services of captains for various shipping services including, in this case, transporting crude by super tanker ("VLCC") from Saudi Arabia to New Brunswick.
Miller J. first found that given that "all stages necessary to take the natural resource to its maximum value for the pursuit of profit is part of the exploitation process" (p. 1810) the transportation of crude to a refinery was part of the process of "exploitation of petroleum". He then went on to note, with respect to the requirement that the taxpayer's employer carry on business outside Canada, that although "if the Canadian company's business is solely that of a placement agency, the business is not being carried on outside Canada simply by virtue that the personnel placed, conducted their activities outside Canada ... if, however, the business is providing services by way of subcontracting to a contractor, which services must necessarily be provided outside Canada, then the business can be considered to be carried on outside Canada". He found that the arrangements here were "more akin to a subcontractor providing services of specialized personnel to sell VLCCs as opposed to simply a placement agency", so that this requirement for the credit being available also was satisfied.