Quebec olive branch to fall flat in Alberta
COMMENT
IWesCteorlnu m Bnuissitness n an open letter this week, Quebec’s government house leader, JeanMarc Fournier, surprisingly called for “reconciliation” with Alberta following the cancellation of the Energy East pipeline project.
It’s a brazen pitch for a province that didn’t miss a chance to sabotage it.
Montreal Mayor Denis Coderre’s famous last words, that the project’s cancellation was “an enormous victory,” will be forever etched in Alberta’s collective consciousness as confirmation that Energy East was sacrificed by Prime Minister Justin Trudeau to accommodate Quebec, which mobilized against it, and where the Liberals need votes in the next federal election.
Nevertheless, Fournier maintains in an Oct. 23 letter that “TransCanada’s termination of the Energy East project is not due to Quebec’s position.”
Echoing the same lame excuses made by the federal government for the $ 15.7- billion project’s collapse, Fournier said “many observers have noted that it was a business decision, based on such factors as the price of oil and the recent approvals granted to Kinder Morgan’s TransMountain expansion, to the replacement of Enbridge’s Line 3 and to TransCanada’s Keystone pipeline.”
QUEBEC’S HOSTILITY TO ENERGY EAST CAME IN OTHER WAYS, TOO.
Quebec’s effort to kiss-andmake-up, now that it got what it wanted, is unlikely to avoid the consequences in Alberta of its Energy East handling.
One of the first big steps to hold Quebec accountable is coming Saturday, when the new United Conservative Party ( UPC) is electing a new leader, increasing the odds it will replace Rachel Notley’s NDP government in two years by uniting Alberta’s conservative voters.
Unlike Notley, whose government expressed disappointment with the collapse of Energy East but did not talk about retribution, UCP leadership front- runners Jason Kenney and Brian Jean have made it their mission to renegotiate transfer payments so Ottawa no longer disproportionately takes from Alberta and gives to Quebec.
Both have called for a referendum to force Ottawa to renegotiate the formula, which they say punishes Alberta for being rich in nonrenewable resources.
There is support in Alberta for such a move amid a resurgence of Western alienation, or a frustration that its priorities (such as the health of its oil and gas sector) are marginalized and undermined by the ‘centre,’ while those of other provinces ( such as Quebec’s Bombardier and Ontario’s auto industry) are prioritized and supported.
There is plenty of evidence that Quebecers, collectively, did everything they could to stand in the way of Energy East.
Mayor Coderre’s victory declaration came after he led a campaign by the Montreal Metropolitan Community, a regional organization of municipal politicians representing more than 80 area cities and towns, to oppose the project on the ground its risks far outweighed its benefits. Meanwhile, it’s not been lost on Albertans that Quebec imports foreign oil to meet its needs, as if that doesn’t come with risks.
Quebec contributed to the regulatory overkill that ultimately sunk the $15.7 billion project. It piled on with its own list of conditions. As Fournier himself puts it in his letter, the province “adopted seven principles to examine the Energy East project, the same principles Ontario adopted, inspired by those of British Columbia.”
Calgary- based TransCanada Corp., the proponent, confirmed its concerns about regulatory creep in the Oct. 5 letter to the National Energy Board ( NEB) where it announced it would no longer proceed with the regulatory review, despite spending more than $1 billion. It said its decision was due to “the existing and likely future delays resulting from the regulatory process, the associated cost implications and the increasingly challenging issues and obstacles.”
Regulatory overkill didn’t end there, of course. It’s becoming so pervasive in Canadian oil and gas it’s created its own business micro climate. Oilsands investment fell apart in the last two years in no small measure due to the introduction of dozens of new requirements to meet Canada’s climate change commitments, even as the industry was reeling from an oil price crash. Less investment means less certainty of oil production, which in turn means less certainty over pipeline requirements.
Quebec’s hostility to Energy East came in other ways, too. TransCanada had to cancel plans for a second marine terminal for Energy East at Cacouna, Que., to allay community concerns about impact on beluga whales. The NEB hearings on Energy East were suspended after violent protests in Montreal. Eventually the whole review went back to square one and was beefed up to win back public trust. The inclusion of upstream and downstream climate change impacts this summer ultimately became the regulatory overreach that went too far.
Through it all, Quebec’s government feigned indifference. Now that Energy East is out of the way, it’s proposing to “dialogue in a spirit of respect and trust ” with Alberta, said Fournier. He’s underestimating how distrusting Albertans have become due to pipeline politics.