Alberta still runs on oil, and NDP has to accept it
Premier Rachel Notley needs a zip line for Calgary’s economy — one that goes up, not down.
Her acrobatic Stampede over, she and her ministers are drifting back to Edmonton.
Calgary is left with the familiar malaise — a sputtering economy that shows promise but never quite relaunches.
Businesses keep closing. A restaurant entrepreneur who owns several places told me he gets at least one call a week from others who want to sell — or, as he said, “give their place away.”
The NDP knows its local political health demands a serious economic boost by next spring. That must include a quick return of high-paying jobs.
They won’t come from subsidies to force diversification in non-energy industries. That’s worthwhile, but it takes years. The easiest gains will still come from good old oil and gas.
And so, NDP language has changed. Ministers used to constantly plug diversification away from petroleum. They wanted off the erratic oil-andgas bronco.
Now they sound like wildcatters who brought in the Leduc gusher.
“We’re an energy province. We always have been and always will be,” Energy Minister Marg McCuaig-Boyd said on Wednesday.
“There’s more work to do, but I’m incredibly optimistic because we’re seeing more Albertans going to work and benefiting from the oil and gas resources we’re so blessed to have.”
She went on to boast of energy sector employment rising by three per cent. Production of bitumen and conventional oil is up 12 per cent and eight per cent, respectively.
The UCP will claim the New Democrats went halfway to destroying the industry but now need its revival to save them. The last part, at least, is absolutely right.
Unfortunately, we can no longer count on old Alberta truisms.
Higher oil prices don’t automatically bring an Alberta boom, or even a higher dollar.
The Canadian economy does not need a wealthy Alberta to thrive. It’s doing just fine without us.
The province still supports wealth redistribution through equalization; but psychologically, the rest of Canada is delinking from the notion that Alberta is an essential economic powerhouse.
We’re not quite on our own. Ottawa did support the Trans Mountain pipeline, to avert its own political crisis.
But nobody is going to hand this province tomorrow’s prosperity. It has to be self-generated through responsible, ecologically sound oil and gas.
Much of this is already happening. Alberta ingenuity is with us still. Plugging the province with rules and refusals only makes entrepreneurs more determined to find the leaks.
On Wednesday, U.S. President Donald Trump underlined this when he blasted Germany for buying 60 per cent of its energy from Russia, and then expecting the U.S. to defend Germany from Russia.
(He was wrong on the details, as usual. Germany does import about 60 per cent of its natural gas from Putin territory, but it also has other big sources of energy.)
Rather than weaponizing an old ally’s problem, Trump could have offered to sell Germany vast quantities of U.S. natural gas.
He didn’t, of course. But Albertans have already thought of that, and they’re hard at it.
Calgary-based Pieridae Energy plans to build LNG facilities at Goldboro, N.S., for upward of $5.5 billion.
Tom Dawson, president of the company’s LNG unit, tells me that existing pipeline comes within 15 metres of the proposed terminal site on Nova Scotia’s southeast coast.
Alberta gas can be routed directly to a terminal via existing pipelines, he says. There are some capacity constraints but it’s doable, without building any extra pipeline.
That means no approvals and no NEB hearings. In development-friendly Nova Scotia, it also means no protests or B.C.-style government blockades.
Most impressive, Pieridae has signed an “offtake agreement” with German-based energy company Uniper, for half of up to 10 million tonnes per year of LNG exports.
The German company has agreed to provide loan guarantees. This makes it much easier for Pieridae to borrow at reasonable rates.
Dawson says Pieridae has also secured supply agreements with other European gas utilities.
At present, the company is nailing down Canadian and American gas supplies that could include a high volume from Alberta.
Over time — hopefully, a short time — this is how the real recovery happens, through a multitude of ingenious midsized projects.
The NDP needs to support such initiatives in every noninvasive way possible.
And then, just get out of the way.
I’m incredibly optimistic because we’re seeing more Albertans going to work and benefiting from the oil and gas resources we’re so blessed to have.