Oil and Gas Sector-Politics and Image

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.

Matthew Mendelsohn is director of the Mowat Centre at the University of Toronto.

The national media have all sided with Alberta Premier Alison Redford over Ontario Premier Dalton McGuinty on the impact of the oil sands on the Ontario economy.
 
The Alberta premier went down to Chicago and chastised the Ontario premier for not loving the oil sands. When McGuinty declined to profess his love, the media piled on him for being ungracious.
 
But Redford should understand that with Alberta’s new economic and political power comes responsibility. Demanding that everyone prostrate themselves at the feet of the oil patch is not the right approach.

Let’s turn to the substance of the issue. The national media objected to McGuinty stating aloud the truth: the value of the Canadian dollar is heavily impacted by the price of oil and the dollar’s appreciation has hurt many in the manufacturing sector.

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

It’s human nature to want to avoid admitting mistakes, and the bigger the mistake, presumably, the bigger the temptation to escape the blame.

Far easier to blame someone or something else, preferably some force beyond one’s control. I couldn’t do my homework because the dog ate my notes; sorry I missed the deadline but there’s a traffic jam on the highway; I remembered your birthday but the package didn’t arrive in time; I wouldn’t have ruined the economy but the dollar is too high.

That last humdinger was offered Monday by Ontario Premier Dalton McGuinty in a bid to slough off responsibility for the economic mess now confronting the province he has led for the past eight years. Politely invited by Alberta’s Premier Alison Redford to lend support to her province’s effort to defend its oil industry — which has been a key reason Canada has avoided recession  — Mr. McGuinty responded with a churlish refusal. Instead he sought to explain away Ontario’s slow slide into debt and deficit as the result of a stronger currency.

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

There’s an old, never-fail strategy in Alberta politics: When your government is in trouble on the eve of an election, pick a fight with Ottawa. Almost nothing rallies Alberta voters around their provincial government like a dust-up with the feds. The only thing better is when Ottawa starts the skirmish.

Alberta may as well not even have held its 1982 campaign. Coming the year after the Trudeau government imposed the National Energy Program on the province, the provincial Conservatives could have run tree stumps as their candidates in most constituencies and won. There were 79 seats in the Alberta legislature that year. The Tories won 75. They earned over 62% of the popular vote.

New Alberta Premier Alison Redford is at the head of a government in trouble (although, according to recent polls, not as much trouble as when she took it over last fall from the bumbling and unpopular Ed Stelmach). And a provincial election is expected this spring. But until Monday, it looked as though Ms. Redford wouldn’t have a central Canadian bogeyman to run against.

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

Hot on the heels of Alberta Finance Minister Ron Liepert’s North American tour, Premier Alison Redford is hitting the road – visiting key American cities, including Chicago, New York and Washington – to sell her vision of a more co-operative energy strategy. But along the way, the rookie Premier seems to be getting a hard lesson in the harsh reality of politics.

Ms. Redford is facing a tough challenge: The capacity of existing pipelines will soon be maxed out and Alberta needs to get the approval of other jurisdictions (either B.C. or the United States) to build new ones. Oil sands opponents have a keen understanding of this dilemma. Their strategy has been to block Alberta’s access to foreign markets, in the hopes of preventing further expansion of the oil sands. In order to counter its opponents and enable the land-locked province to export its bitumen, Ms. Redford has been trying to get other politicians to help her sell the oil sands – specifically, the Premier of Canada’s largest province, Dalton McGunity.

“We in Alberta have a resource that matters to the rest of the country,” said Ms. Redford. “It’s not enough for Alberta to be talking about the importance of Keystone in the United States. We need the Premier of Ontario talking about that.”

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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.

Dalton McGuinty, the Premier of Ontario, should not have responded ungraciously to an appeal by Premier Alison Redford of Alberta for solidarity from Ontario and Quebec, in the course of her speech on Friday to the Small Explorers and Producers Association on Friday. In particular, she wants the Premiers of the two Central Canadian provinces to help articulate the importance of the Keystone XL pipeline to the country as a whole.

“If I had my preferences,” said Mr. McGuinty – using the subjunctive mood to express what grammarians call a contrary-to-fact hypothesis – “as to whether we had a rapidly growing oil and gas sector in the West or a lower dollar, I’ll tell you where I stand: with the lower dollar.”

But Mr. McGuinty cannot enforce his preferences. Such exercises of the imagination are futile. There is of course a correlation between the exchange rate of the Canadian dollar and foreign demand for Canadian commodities, and a higher dollar means that Canadian goods – both manufactured products and natural resources – are more expensive.

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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.

TORONTO AND CALGARY— Alberta Premier Alison Redford’s vision of a national Canadian energy strategy has bogged down in an increasingly bitter dispute with Ontario over the economic benefits of the oil sands.

Ms. Redford had suggested Ontario should be a more vocal advocate for oil-sands development, on the grounds that related businesses benefit Ontario’s economy. That met with a rebuff on Monday from Ontario Premier Dalton McGuinty, who said Canada’s high “petro dollar” has hobbled exporters in his province.

That prompted a sharp rebuke from Ms. Redford. She said Mr. McGuinty’s “simplistic” approach to the oil sands and the Canadian dollar is based on a “false paradigm” and suggested that the leader of the country’s one-time economic powerhouse needs to broaden his outlook.

“When we talk about oil sands, it’s not about what’s in Alberta’s best interests,” Ms. Redford told reporters Monday. “It is about what’s in Canada’s best interests.”

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The Toronto Sun is the city’s daily tabloid newspaper.

QMI Agency

Three years ago, taxpayers were forced to loan $13.7 billion to General Motors and Chrysler because no banks were crazy enough. Some of that taxpayers’ money has been repaid, but $5.5 billion will never be recovered.

Could you imagine if Alberta’s premier had campaigned against that bailout? Or even spoke out against it now? It’s not like the bailout worked, after all.

There are 2,000 fewer jobs at GM today and 800 fewer at Chrysler. As economist Mark Milke points out, the jobs that were “saved” — at least for now, until the next bailout — cost $90,000 each at Chrysler, and $474,000 each at GM. That’s not a typo. Taxpayers spent $474,000 to “save” each job at Government Motors.

What if Alberta’s premier had said: “If I had my preferences as to whether we prop up a failing, obsolete, over-unionized company in the East or lower taxes, I’ll tell you where I stand: With lower taxes.”

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The National Post is Canada’s second largest national paper. Terence Corcoran is the editor and columnist for the Financial Post section of the National Post.

By saying no to Alberta’s oil sands, McGuinty is starting a campaign for Ottawa to bail out Ontario

Ontario Premier Dalton McGuinty, his province in hock up to a looming $400-billion and his political future looking grim, has decided to do what demagogues often do best: take on an extraterritorial foe. If you can’t win at home, maybe you can pretend to destroy some mythical foe thousands of kilometres away. These days, what could be safer for a broke lefty premier who has squandered billions on dead-end green energy projects than to direct attention to Alberta’s oil sands and Alberta Premier Alison Redford.

What Mr. McGuinty is really after here, however, is not the humiliation of Alberta but the transfer of federal cash to Ontario. The oil sands comments are a pretext, another McGuinty McGuffin that is the front for other real motives.

For weeks now, Ms. Redford and key members of her Conservative Cabinet — Energy Minister Ted Morton and Finance Minister Ron Liepert — have been trying to enlist Ontario and other provinces in a campaign to boost the oil sands as part of a Canadian Energy Strategy.

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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.

CALGARY— Supporters of Alberta’s oil sands say Ontario needs to do more to publicly defend the resource, including standing up for the controversial Keystone XL pipeline, since its economy is the country’s second-largest beneficiary from the production of the gooey bitumen.

According to Alberta Premier Alison Redford, in Chicago for a few days talking up her province’s oil and gas industry, Quebec also needs to do its part to tell Alberta’s story. This is particularly important, she said, on the issue of the $7-billion pipeline that would link Canada to Texas, a project delayed by the White House.

And the rookie Premier, set to soon visit New York and Washington as well, isn’t alone. Pundits and industry are also calling on the have-not provinces to come to oil-rich Alberta’s aid.

“We in Alberta have a resource that matters to the rest of the country,” Ms. Redford recently told members of the Small Explorers and Producers Association of Canada in Calgary, “It’s not enough for Alberta to be talking about the importance of Keystone in the United States.

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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.

You know that old saying, “When the U.S. sneezes, Canada catches a cold.”

It still applies. The United States remains our biggest trading partner. What happens there affects everything from our tourism to our exports. But now, Canada is facing a bigger threat to its economic health.

It’s called Dutch Disease — and it’s complicated by Prime Minister Stephen Harper’s newly acquired China Syndrome. Stung by U.S. President Barack Obama’s rejection of the Keystone XL pipeline, Harper is looking to China’s government-owned oil companies.

Dutch Disease isn’t about tulips or wooden shoes or even sick elm trees. It’s about Canada’s steady conversion to a petro-state, fuelled by the rapid development of Alberta’s oilsands. It means that, more and more, Canada’s economy will be subject to the price of oil.

Coined by The Economist in 1977, “Dutch Disease” describes what happened to the Netherlands after natural gas fields were discovered off its shores. The little country became so economically entangled with its resource industry, its manufacturing sector tanked.

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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.

Canada’s bitumen resources have a problem, and neither the companies that wish to exploit bitumen or the governments trying to help them seem to understand it.

Bitumen, from which oil is produced, takes more energy per barrel to get at than conventional oil pumped from the ground. Because it needs more energy, bitumen-derived oil produces more greenhouse gas emissions that cause global warming than conventional oil.

That gap – between bitumen-derived and conventional oil – is the problem the industry and governments don’t seem to get. And that gap will widen as more steam-driven in-situ production comes on line, since in-situ uses more energy than open-face mining of bitumen.

There’s not much the oil industry can do about opponents who don’t like any fossil fuels and seek their elimination. These opponents are going to do what they can in an open society to stick spokes in the industry’s wheels.

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http://www2.macleans.ca/

Will new technologies make North American energy self-sufficiency a reality?

The rural state of North Dakota is famous mainly for its rough weather. Its largest city, Fargo, is best known to outsiders as the title of a noir movie in which a body is fed through a wood chipper. With a population half the size of Winnipeg’s scattered across rugged plains, it once held the distinction of being the least-visited state in the U.S. But today, so many people are flocking to North Dakota that there is nowhere to put them.

In a nation beset by joblessness, workers are coming here in such numbers that an estimated 15,000 people are now living in trailers, cars, corporate “man camps” and other forms of makeshift housing. So scarce are places to sleep that in 2010 one firm housed some of its workers by trucking in a chunk of Vancouver’s recently used Olympic Village to the overwhelmed city of Williston.

The reason is an oil boom. Production in the state has surged from 100,000 barrels per day in 2007 to 500,000 barrels per day and growing—almost overnight making North Dakota the fourth-largest producer in the U.S., and on its way to becoming second only to Texas.

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

This has been a good week for Alberta’s oil sands — if you measure success in tiny increments. The European Union couldn’t agree to label oil from the ‘sands as dirty, and one of the world’s leading climate scientists released a study showing that large-scale mining of Alberta’s vast bitumen deposits will have very little effect on climate.

The news from Europe is welcome if not quite a full-fledged victory. On Thursday, bureaucrats and experts from the EU’s 27 member countries failed to pass an amendment to the union’s Fuel Quality Directive that would have labelled oil sands oil as 22% more harmful to the climate than convention crude. The vote was 89 in favour of the amendment, 128 opposed with 128 abstaining. Since there was no majority for or against the motion, it neither passed nor failed.

But Thursday’s vote was never going to be the final word. It was, in essence, a survey of environment department bureaucrats and government scientists meant only to inform Europe’s energy and environment ministers. The ministers will hold their own vote — likely late this year — from which will emerge their recommendation to the European Parliament, whose members will cast the ultimate vote on whether or not oil sands oil should be considered “dirty” oil.

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

EU fails to back ‘directive’ that ­penalizes the oil sands — but the threat isn’t gone

It wasn’t just the oil sands that dodged a bullet on Thursday, when Eurocrats failed to support a “Fuel Quality Directive” that would have penalized European companies using such oil. Although the move would have no direct impact, since Canada exports little or no oil sands oil directly to Europe, it would have darkened the cloud over Canadian/European free trade aspirations and created a dangerous precedent.

It would have further handed control of trade, and thus the Canadian economy, to a bureaucratic juggernaut effectively controlled by environmental radicals through political puppets. It would also have raised the possibility that restrictions might extend to U.S. exports to Europe of refined products containing oil from the oil sands.

Canada’s Natural Resources Minister, Joe Oliver, described the vote as a “resounding win,” but noted that Canada would continue to defend its interests against “unjustified and discriminatory measures.” Which is a pretty good definition of climate policies in general.

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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’s lobbying campaign pays off; blocked regulation preserves access to global markets

OTTAWA — GLOBAL ENERGY REPORTER – The Harper government picked up key support from France and the Netherlands in blocking a proposed European Union fuels directive that would target the oil sands as a particularly emissions-intensive source of crude.

A vote in Brussels on Thursday gave the Canadian government a win in its battle to preserve global markets for oil sands producers against an environmental lobbying effort, which wants refiners worldwide to pay financial penalties for using the carbon-intensive Alberta crude as well as other sources of “dirty” fuel.

Ottawa has been lobbying the Europeans for two years for fundamental changes to an EU proposal to label oil sands as being more carbon-intensive than other crude sources – a tag that would effectively ban oil sands crude, and threaten to snowball to other regions. Britain had clearly indicated it was in Canada’s camp, but on Thursday, France and the Netherlands helped derail the proposed regulation by abstaining on the vote, which needed a majority of total votes to pass.

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