It must have seemed odd at first blush seeing Big-Oil
shoulder-to-shoulder (figuratively and literally) with Premier
Notley on Sunday during the provinces roll out of the review
panel's report on climate change (the "details" of
whpich have now been widely reported so won't be repeated
here). After all, we are in the new reality of a wide plateau of
$40.00/bbl oil. How one might rightly ask, can our beleaguered
producers possibly absorb another body blow in this perfect storm
of declining global oil consumption and the U.S. shale oil
renaissance with the resultant low net-backs for Canadian oil producers...much less have the
leaders of Shell Canada, Canadian Natural Resources Ltd., Suncor
Energy Inc. and Cenovus Energy Inc. seemingly welcome the blow with
The answer is simple.
There are many uncertainties in the world of Western Canadian
oil producers, but one certainty is that we need additional
tidewater access for our oil production, full stop period. Without
the new pipelines and associated infrastructure to get our product
to points other than the U.S. Gulf Coast, our producers remain
bottlenecked with the commensurate abysmally low net-backs relative
to other North American and global oil producers. However, call it
perception or reality (and the distinction really doesn't
matter), very recent history has evidenced from the highest offices
that the reality/perception of "dirty-oil" trumps
pipeline projects in the sphere of public opinion. So Mr. Edwards,
Mr. Williams and friends had to be resigned into the "if you
can't beat 'em, join 'em camp" and to their credit
likely saw this coming months ago given the foreshadowing within
the Kinder-Morgan/TransMountain NEB hearings and all attempts
within those hearings to draw into consideration, downstream and
upstream GHG considerations.
So let's take a body, but not a fatal blow and address in
some measure the political realities in the United States. All in
the hopes that this short term pain serves our enterprises (to say
nothing of the planet) advantageously over the longer term. This
particularly when the pain is not absorbed only by the oil
producers but instead by an economy-wide carbon tax.
It is a rare occurrence when both our industry and our planet
benefit from a single political action. Even rarer in Alberta when
describing that action is to use the word "tax" and
"benefit" in the same sentence.
As noted by many others, Sunday was in fact a
"game-changer". One to be embraced, respected and
celebrated as our industry continues what would appear to be a very
long migration across the plateau.
The foregoing provides only an overview and does not
constitute legal advice. Readers are cautioned against making any
decisions based on this material alone. Rather, specific legal
advice should be obtained.
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.
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).