Originally published in Globe and Mail Tuesday, Dec.
The handling of the Keystone XL pipeline process by the Obama
administration serves as a loud wake-up call for Canada. While
America remains our most important market, Prime Minister Stephen
Harper has said that Canada should not be a "captive
supplier" of energy for the United States. In light of global
demand growth, it's also in Canada's national interest for
Ottawa to act decisively to enable our oil and gas industry to
diversify its customer base.
The fast-growing markets in Asia, particularly China and India,
are obvious targets, but they need the assurance that Canadian oil
won't be landlocked in Alberta. Federal and provincial
governments must understand that the Chinese and Indians are not
sitting idly by enjoying the spectacle of the interminable and
uncertain Canadian regulatory process. They're actively seeking
long-term supplies from other producers around the globe.
Obviously, the best way to ship Canadian oil to Asia would be
through West Coast ports. That's the rationale both for the
proposed Northern Gateway pipeline to Kitimat and for expanding the
existing Trans Mountain pipeline system to B.C.'s Lower
Mainland. But the longer the regulatory approval process drags out,
the more likely it is that potential customers will go
There are, of course, environmental and aboriginal concerns that
need to be addressed, but neither should be allowed to stymie
legitimate, environmentally sound infrastructure development. Those
who are fundamentally opposed to any expansion of oil sands
development will never be satisfied. No process and no amount of
consultation will reconcile their concerns.
Canada must do more to reduce carbon emissions from the oil
sands; the federal government should work with Alberta to establish
effective standards for the industry so that unconventional crude
generates the same level of emissions as most conventional oil. We
need a balanced action plan that enables greater production of a
valuable resource as well as enhanced environmental standards that
constrain our carbon footprint.
But if Canada doesn't get its act together quickly,
we'll miss a historic economic opportunity. Without fresh
direction, the current lengthy and uncertain regulatory process may
torpedo the possibility of moving oil to the Pacific Coast. The
government, therefore, needs urgently to put in place a new
streamlined and time-certain regulatory process. It would also be
prudent for industry and government to consider options to a West
A more immediate way to ship oil to the Far East from Alberta
may lie east, not west. Moving Western Canadian oil to the East
Coast over existing rights of way holds two major benefits for
Canada. First is the displacement with domestic supply of
relatively expensive imports of foreign oil, some of which comes
from the politically uncertain Middle East. Few Canadians realize
that Eastern Canada (except Newfoundland) still relies on imported
foreign oil. Moving product from west to east can be done
relatively simply with few regulatory hurdles. It requires
reversing certain existing pipelines. In the longer term, it may
mean constructing a new pipeline from Montreal to Atlantic Canadian
Second, opening access for Western Canadian crude to Eastern
Canada and East Coast ports has the huge added advantage that it
can provide certainty of supply to potential Asian customers.
Canadian crude and bitumen, whether or not refined in Canada, could
be shipped by tanker from Montreal or other East Coast ports
through the Panama Canal to Asia. The route may be longer than from
Kitimat or Vancouver, but the ability for Asian customers to
negotiate guaranteed long-term supply contracts would far outweigh
the additional marginal cost of transportation. Industry and
government should now work together on an urgent basis to take the
steps necessary to enable flows of Alberta oil from west to
Diversifying Canadian oil exports beyond the U.S. market is in
the national interest and must be a national priority. It calls for
leadership and action at the national and provincial levels.
It's one thing to say we're an "energy
superpower," quite another thing to act like one.
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Canada is a constitutional monarchy, a parliamentary democracy and a federation comprised of ten provinces and three territories. Canada's judiciary is independent of the legislative and executive branches of Government.
The Government of Alberta recently announced a number of policy changes that will impact the Alberta Electricity Market, composed of its generators, transmitters, distributors, retailers, electricity consumers and wholesale electricity market.
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