Obama casts doubt on Canada’s ambition to be an energy superpower – by Carol Goar (Toronto Star – January 30, 2013)

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Hopes for a quick U.S. approval of the Keystone XL pipeline fade, forcing Canada to rethink its status as an energy superpower.

Much has changed since Barack Obama threw a spanner into Stephen Harper’s plan to make Canada an energy superpower.
A year ago, the U.S. president rejected an application by TransCanada to run a massive pipeline from Alberta to Texas. Canada’s prime minister assured oilsands producers it was just a hiccup; the project would get the green light after the U.S. election.

Three months ago, Americans re-elected Obama. He still hasn’t approved the Keystone XL pipeline.
Last week he pledged to make climate change a higher priority in his second term. “The path toward sustainable energy sources will be long and difficult,” he said in his Jan. 21 inaugural speech. “But America cannot resist this transition; we must lead it.”

Two other shifts in the landscape have occurred:

  • The U.S. has moved a long way toward energy self-sufficiency. It produces enough natural gas to meet its own needs thanks to hydraulic fracturing (“fracking”).

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Moral ­sediments [Oil sands] – by Peter Foster (National Post – January 29, 2013)

The National Post is Canada’s second largest national paper.

Alarmists exaggerate oil sands lake study

The global environmental movement has used Alberta’s oil sands as a fundraising poster demon for climate activism. That activism continues to focus on stopping the proposed Keystone XL pipeline — on which U.S. President Barack Obama is expected to decide within the next few months — but the villain in this morality play remains the oil sands themselves.

Whatever the state of “the science,” even greatly expanded oil sands development could have no observable impact on the global climate. However, their possible local effects require sound and objective study. The problem is that some of the leading researchers are themselves climate alarmists and political activists.

A recent example of how ideology may be corrupting science — and how eagerly a crusading media regurgitates alarmism — came with the release of a study of the impact of emissions from the oil sands on nearby lakes. The study appeared three weeks ago in the Proceedings of the National Academy of Sciences. Most of its authors were from Environment Canada, but its chief promoter was Queen’s University professor John Smol, Canada Research Chair on Environmental Change.

Queen’s issued a press release on the paper with the headline “Oil sands study shows negative impact on lake systems.” In fact, the study — which analyzed sediments in lakes close to the oil sands for deposition of polycyclic aromatic hydrocarbons (PAHs) — didn’t show any such thing.

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Alberta’s ‘boom and bust’ plague must end – by Jeffrey Simpson (Globe and Mail – January 30, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

How do you change a political culture? Is a crisis required for change, or will honest talk without a crisis suffice? How many times does a jurisdiction have to make the same mistake before people wake up?

These questions relate to Alberta today, just as they have in the past. Alberta is not the only place where an entrenched political culture produces enduring mistakes, but it’s the one in the headlines – again.

Alberta’s political culture is about low taxes and big spending. The province has the lowest taxes in Canada – the so-called Alberta Advantage – and it’s at or near the top in terms of per capita spending on government programs such as health care.

Filling the gap between the low taxes and munificent services are revenues from oil and natural gas. These revenues account on average for 30 per cent of Alberta’s budget. These revenues fluctuate with world prices, North American energy markets and other factors beyond the province’s control. Unsteady prices lie at the heart of the “boom and bust” plague of Alberta’s economy – and its budget.

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Alberta Premier Alison Redford flip-flops on budget promises – by Gillian Steward (Toronto Star – January 29, 2013)

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Gillian Steward is a Calgary writer and journalist whose column appears every other week.

To live in Alberta these days is to run the risk of getting severe whiplash.

This is because our provincial government often tells us how fortunate we are to live in such a prosperous a province; how Alberta is blessed with such an abundance of resources. But the next day our government tells us it doesn’t have enough money to cover its spending, there will have to be cuts to services; and we are all suddenly jerked into a different reality.

This time around our premier, Alison Redford, seems quite panicked about the drop in government revenues. So much so that she prepared a special TV spot (eight minutes) that was broadcast across the province last week at taxpayers’ expense to reassure us that the sky is not falling.

She wasn’t very clear about what exactly her government intends to do about the shortfall in revenues: the provincial budget won’t be revealed until March. All we know at this point is that the government has $6 billion less than it thought it would have, a big chunk of a projected $38-billion budget.

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Producers back TransCanada’s plan to pipe oil east – by Shawn McCarthy and Nathan VAnderklippe (Globe and Mail – January 29, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

OTTAWA AND CALGARY — Western Canadian oil producers fear that a growing glut of light oil in their traditional market will drive down the value of their crude, and are looking to TransCanada Corp.’s proposed west-to-east pipeline as a route to world prices for their oil.

While political proponents of the cross-country pipeline say it would bring cheap western crude to Eastern Canadian refineries, the oil companies are clearly eyeing the line as a way to get their oil into markets that are paying the world price.

“Any access to the Eastern Canadian refinery markets, to Europe or Eastern Seaboard refineries, that is a plus for the industry as a whole,” said Murray Nunns, chief executive officer of Penn West Petroleum Ltd.

TransCanada has won the endorsement for its $5-billion pipeline plan from New Brunswick Premier David Alward, who will travel to Alberta next month to visit Premier Alison Redford and put some political momentum behind the project. TransCanada says it is confident the project will be competitive with other proposed new routes, but still must line up shippers willing to make long-term commitments to justify its investment.

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New Brunswick pushes cross-country pipeline as ‘game changer’ – by Jane Taber, Shawn McCarthy and Nathan Vanderklippe (Globe and Mail – January 28, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

HALIFAX, OTTAWA and CALGARY — New Brunswick Premier David Alward is headed to Alberta to inject some political momentum into a proposed $5-billion, cross-Canada oil pipeline that he describes as a nation-building project.

The Progressive Conservative Premier will make his first visit to Alberta early next month, where he will meet with his counterpart, Alison Redford, travel to Fort McMurray to tour the oil sands, and visit industry executives in Calgary.

In an interview, Mr. Alward expressed enthusiasm for the proposed TransCanada pipeline project that would bring western oil to eastern Canadian refineries, and perhaps allow for crude exports from the deep-water port of Saint John.

“This is something that is potentially a game-changer for New Brunswick, but more importantly than just New Brunswick, for all of Canada,” Mr. Alward said.

Ms. Redford echoed that enthusiasm in an interview, characterizing the west-east pipeline as “critically important.” She added, too, that she believes the project is “quite feasible” and “economically viable” for the industry.

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Nebraska nod puts Keystone pipeline decision squarely on Obama by Shawn McCarthy and Nathan Vanderklippe (Globe and Mail – January 23, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

OTTAWA and CALGARY — TransCanada Corp.’s controversial Keystone XL pipeline project has cleared a key hurdle in Nebraska, leaving U.S. President Barack Obama to decide whether the promised benefits of energy security and construction jobs will trump concerns over climate change.

In a show of optimism, TransCanada chief executive officer Russ Girling said Tuesday that his company is gearing up to begin work on one of the biggest construction projects the United States can expect this year as soon as there is a positive decision from Washington.

In a letter to the President, Nebraska Governor Dave Heineman said the state has approved TransCanada’s new route that avoids a fragile ecological zone and that the project would provide $418-million (U.S.) in economic benefits in his state alone.

Mr. Obama cited the potential impact on Nebraska’s Sandhills region when he first delayed the project last November and told TransCanada to work with Nebraska on a new route.

With Mr. Heineman’s approval, all eyes now turn to Washington, where Mr. Obama signalled in his inaugural address Monday that the fight against climate change will rank high on the agenda for his second term, along with boosting the sluggish economic recovery.

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Keystone vs. religion – by Peter Foster (National Post – January 23, 2013)

The National Post is Canada’s second largest national paper.

Climate change isn’t about policy as much as religion

Nebraska Governor Dave Heineman’s approval on Tuesday of the revised Keystone XL pipeline route provided some counterbalance to President Obama’s recommitment to the climate agenda in Monday’s inaugural speech, but the pipeline is still far from a shoo-in. Meanwhile, the renewed emphasis on climate change signals more comprehensive uncertainty for Canada/U.S. relations. The problem, as ever, is that climate change isn’t so much about policy as religion.

The ever-perceptive Adam Smith noted how political factions often recruit God to their cause. “Even to the great Judge of the universe,” wrote Smith, “they impute all their own prejudices, and often view that Divine Being as animated by all their own vindictive and implacable passions.” Mr. Obama left us in no doubt on Monday that God demanded action on climate. “That,” said Mr. Obama, “is how we will preserve our planet, commanded to our care by God.”

The speech confirms that Mr. Obama’s re-election — contrary to what an overwhelming majority of Canadians apparently think — is bad news for Canada, first in terms of what Mr. Obama’s rigid statism and fiscal fecklessness may do to the U.S. economy, and then in terms of policies that specifically affect Canada, primarily on energy and climate.

A common take on the inaugural speech was that it signalled a No More Mr. Post-Partisan Nice Guy. In fact, there never was such a guy. Mr. Obama’s attitude to opponents has always been dismissive. His self-righteous approach was summed up in the assertion that “We cannot mistake absolutism for principle or substitute spectacle for politics, or treat name-calling as reasoned debate.”

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Oil price shocks, 40 years on – by Peter Tertzakian (Globe and Mail – January 22, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

This year marks the 40th anniversary of the 1973 oil price shock. Rifling through an old Life magazine sparked memories of the Middle Eastern drama. Looking at some of the contrasting photos – a room full of jovial Arab leaders enjoying the 250-per-cent rise in the price of oil; a western freeway void of cars due to widespread gasoline shortages – the disco-era reminiscence gave pause for thought about vulnerable oil markets.

Running some numbers on the flashback was thought-provoking, too: in real dollar terms a barrel of light oil (world price) is 40-per-cent more expensive today than it was during the second, 1979 price shock (see accompanying chart Real Price). Should oil producers be concerned about a price fall from today’s lofty high?

At a time when global oil demand was growing by 9 per cent per year, the 1973 Arab-Israeli war and resulting embargo by the Organization of Arab Petroleum Exporting Countries (OAPEC) drove the price of a barrel of oil up nominally from $3.00 (U.S.) to $8.00. Figure 1 shows that the elevated prices lingered for seven years, until after 1979, when the second blow of the one-two punch was thrown. The vicious Iran-Iraq war took 7 million barrels per day (MMB/d) off the world market, resulting in a fourfold, average $32a barrel jump in oil prices. Adjusted to today’s dollar terms, Figure 1 shows that prices in the late ‘70s climbed to $80 a barrel.

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Landlocked Alberta facing budgetary ‘perfect storm’ as oil price gap stings: Horner – by Claudia Cattaneo (National Post – January 22, 2013)

The National Post is Canada’s second largest national paper.

With world oil prices staying comfortably above US$100 a barrel, Alberta should be living large and cashing in on the boom. Instead, Albertans have been robbed of their windfall by a shortage of pipeline space and by competing new oil production in the United States.

The mix has depressed Canadian oil prices so much that the provincial government warned Monday its March 7 budget for 2013/2014 will make a big course correction from big spending to big belt-tightening.

The province is facing a “perfect storm” because Canadian oil sold in the U.S. is selling at a deep discount, world markets seem increasingly out of reach and resource revenues have plummeted, Doug Horner, Alberta’s Finance Minister, said in Calgary.

“No storm is good and this one is going to be severe,” Mr. Horner told reporters after addressing the Calgary Chamber of Commerce.

Mr. Horner said the gravity of the problem hit home just in the past few months and it was only before Christmas that Alberta, the federal government and industry realized the magnitude of the North American oil glut.

“Our biggest problem is that Alberta is landlocked,” Mr. Horner said. “In fact, of the world’s major oil-producing jurisdictions, Alberta is the only one with no direct access to the ocean.

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Time to fight back against Hollywood’s [mining and oil/gas industry] misinformation – Gwyn Morgan (Globe and Mail – January 21, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Hollywood hates big business. Movies portraying corporate leaders as greedy villains have been common for decades, but the film that inspired today’s movie makers had its roots in British Columbia. That was the 2003 documentary The Corporation, written by a University of British Columbia law professor, Joel Bakan.

It featured a procession of leftist luminaries, including Naomi Klein and Noam Chomsky, uttering views such as that corporations turn citizens into “mindless consumers of goods that they do not want” and that “the problem comes from the profit motivation.”

Hollywood’s attack has escalated to the point where many films feature an anti-corporate “moral” message, the most popular of which portray industries as uncaring pillagers of the environment. The plot of James Cameron’s 2009 blockbuster Avatar featured a greedy mining boss intent on destroying an ancient forest inhabited by native humanoids on the distant planet of Pandora to mine a precious mineral called unobtanium.

Animated films for children also follow the lead; consider 1992’s FernGully: The Last Rain Forest, in which fairy folk help stop a logging company from destroying their forest home.

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Brad Wall urges Obama to ‘swiftly’ approve Keystone pipeline – by Josh Wingrove (Globe and Mail – January 18, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Edmonton — Saskatchewan Premier Brad Wall is urging President Barack Obama to “swiftly” approve the Keystone XL pipeline project, issuing a letter signed by 10 state governors – but not Alberta’s premier.

Mr. Wall calls the energy relationship between Canada and the U.S. “vital to the future of both our countries.” He urges Mr. Obama, who will be formally inaugurated for his second term this weekend, to approve the proposed pipeline to create jobs while recognizing the governors’ and premiers’ commitment to “responsible stewardship” of the environment.

“Mr. President, we consider the Keystone XL pipeline fundamentally important to the future economic prosperity of both the United States and Canada,” Mr. Wall wrote. “We strongly urge you to issue a Presidential Permit and act swiftly to approve the Keystone XL pipeline.”

There are notable omissions among the letter’s signees, however. Those include Alberta Premier Alison Redford, a long-time advocate for the pipeline, and Nebraska Governor Dave Heineman, whose state has raised some of the most acute environmental concerns about the pipeline project.

The project would carry oil from Alberta, into Saskatchewan, through six U.S. states and down to the Gulf Coast. The signees on Mr. Wall’s letter include the governors from four of the six states Keystone XL would cross: South Dakota, Kansas, Oklahoma and Texas.

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First nations’ growing voice pressures resource sector – by Shawn McCarthy (Globe and Mail – January 17, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

OTTAWA — Canada’s energy and mining companies are facing new challenges from first nations that are demanding the right to approve all resource projects on traditional territories and to participate in the revenues.

Saskatchewan Regional Chief Perry Bellegarde on Wednesday called on governments not to approve leases or other exploration rights unless companies can demonstrate they have properly consulted local aboriginal communities. He said resource companies should bring first nations into their planning at the earliest possible stages, and be prepared to treat them as full partners in development.

“We have to be involved in the economy – fully and no longer marginalized,” Mr. Bellegarde said. “Because if we keep talking about self-determination as indigenous peoples, that’s got to be linked to self-sufficiency.”

Spurred by “Idle No More” protests, many of the country’s chiefs met last week with Prime Minister Stephen Harper, who committed to work more closely with them on treaty rights and economic development.

Chief Bellegarde is the lead spokesman for the Assembly of First Nations on treaty rights, and his comments echo demands from chiefs and protesters alike that aboriginal people must be given greater control over their traditional territory.

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Provinces need to be at negotiating table with natives – by Martin Papillon (Toronto Star – January 17, 2013)

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Martin Papillon is an associate professor of political studies at the University of Ottawa.

So, they met . . . and promise to talk more. Prime Minister Stephen Harper spent last Friday afternoon discussing treaty rights, land claims and economic development with Assembly of First Nations representatives.

The problem is, despite the good will of those involved, we know the impact of these high level discussions will be limited. The reason is quite simple: Real substantive change in the relationship between First Nations and Canada will have to involve provincial governments.

Provinces, not the federal government, are responsible for the management of public lands, natural resources, education, health care and many other key policy areas at the core of First Nations demands. This won’t be easy. First Nations, many of whom have signed treaties with the Crown, are reluctant to engage in formal relations with provinces.

Treaties, they argue, established a nation-to-nation relationship with the Crown in Right of Canada, not the provinces. From their standpoint, provincial engagement is a denial of their unique status and a step toward assimilation into the broader framework of Canadian citizenship.

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Alberta should learn from Norway on managing oil – by Bruce Campbell (Toronto Star – January 17, 2013)

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Bruce Campbell is executive director of the Canadian Centre for Policy Alternatives. His study, The Petro-Path Not Taken: Comparing Norway with Canada and Alberta’s Management of Petroleum Wealth, is available on the CCPA website: http://policyalternatives.ca

Momentum is building across Canada on the need to develop a sustainable national energy strategy. On this front, Canada and Alberta, its main petro-province, have much to learn from another major petroleum-producing and exporting country, Norway.

Canada and Norway are advanced industrialized countries with highly developed political, bureaucratic and economic institutions.

Norway and Alberta have similar population size, similar production profiles, and similar levels of dependence on petroleum exports and government petro-revenues. During my recent trip to Norway, I found they have taken very different paths, and with very different outcomes.

In Norway, there was from the outset, a societal consensus that the government should play the dominant role in the petroleum industry, both as owner and regulator. The Norwegian government owns 80 per cent of petroleum production, and retains roughly 85 per cent of the net petroleum revenues mainly through a 78-per-cent company tax and through direct access mechanisms.

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