Liberals are missing in action: Notley
Liberals missing in action, says Alberta premier
Rachel Notley came out of the West with all guns blazing.
At a lunchtime speech in Ottawa, the normally affable Alberta premier said the Canadian government is “wilfully” holding Alberta’s economy hostage because of its inability to follow through on its constitutional responsibility to transport resources across provincial boundaries.
The lack of a pipeline to the ocean has constrained the ability to diversify markets and resulted in the current crisis — 10 buck a barrel Canadian crude, she said.
That predicament is costing the country $80 million a day, she said. It is resulting in job losses in Alberta and explains why Justin Trudeau was met by 2,000 protesters in the streets of Calgary last week, a spontaneous eruption of anger that persuaded people “to drop what they were doing and flood the streets … people aren’t going to take it,” she said.
The problems facing the Trans Mountain pipeline, now owned by the federal government but stymied by a Federal Court of Appeal decision, are compounded by other federal government actions (or inactions) — the environmental assessment legislation, C-69, which is currently before the Senate; the tanker moratorium off the northern coast of British Columbia, and the failure to increase take-away capacity by buying rail cars.
Notley said she had asked Trudeau to join her government in buying rail cars to ship an additional 120,000 barrels a day.
“The federal table should be at the table on this. There’s no excuse for their absence. (But) Alberta will buy the rail cars ourselves to move this oil,” she said.
“We’re not wasting any time.”
The catalogue of abuses detailed by Notley has Westerners of a less temperate disposition reaching for their Winchesters.
But there are signs that the feds are set to hand the premier some wins.
In a letter to Trudeau last month, she expressed her specific concerns over C-69, particularly the prospect of putting so-called “in-situ” oilsands production on the list of projects that will be governed by stricter new federal environmental assessments, as part of C-69.
That is important because the in situ projects, which involve injecting steam through well bores as a way of tapping deeper bitumen seams, are seen as the future of the oilsands and are currently subject to provincial review.
In a letter of reply, the prime minister indicated the new legislation would only regulate projects in areas of federal jurisdiction.
Notley confirmed her interpretation was that in situ project will be exempt from C-69’s provisions.
“What they have told us in the past is that in situ will not be on the project list but we need to see that set out very clearly in the regulations before they move forward on legislation,” she said.
In her letter, the premier asked Trudeau to “postpone” passage of C-69 until the uncertainty in the legislation is resolved. Federal sources suggest that concerns over issues like in situ project reviews will be addressed in the regulations.
Another worry for Notley in her letter was “downstream” greenhouse gas emissions, which she argued should be rejected in relation to any projects under review.
Environmentalists have argued downstream emissions that occur when fossil fuels are burned should be included, even though they admit most of the end use actions will not happen in Canada.
In his reply last Friday, Trudeau confirmed that “downstream emissions will not be considered.”
Notley said, again, she wants to see it written into the regulations. “This whole ‘trust us, trust us, trust us’ thing is not a thing. So what we need is to see it in writing.
“It’s not just for us. It’s for investors. This legislation, although well intentioned, has left investors looking at it and saying ‘we don’t know what this means, we don’t know how this is going to roll out, we don’t know if we’re ever going to get anything built in Canada’.”
As Notley was speaking in Ottawa, the man who wants her job in next spring’s Alberta election, United Conservative Party leader Jason Kenney, was calling for a mandatory curtailment of production in the oilpatch by 10 per cent.
In the interview, the premier said she established three envoys, including her former chief of staff Brian Topp, to consult with industry on ways to reduce the price differential.
I asked if, philosophically, the best way to cut the price gap was a production curtailment?
“It’s very complex. A lot of people equate it to the time when Premier (Peter) Lougheed did a similar thing. But the industry is very different now, the profile is very different. The different players are constructed differently, so doing one thing to fix these issues has a cascade of consequences that wouldn’t necessarily have been at play last time it was used. That being said, we’re looking at all of our options and we will roll them out when it’s good for the whole industry to hear them at once, rather than contributing to rampant speculation that will scare people in the market,” she said.
On the tanker ban off the West Coast, Notley noted in her speech it is not a tanker ban as such, it is specifically an oil tanker ban. The legislation continues to allow the shipment of liquefied natural gas but blocks even lighter hydrocarbons that have been refined. The province disagrees with the federal testing method that categorizes such products as “persistent oils” and argues they are “condensates” that would be less harmful to the environment if spilled.
“No matter what we do in Alberta, even if we upgrade more, even if we find ways to refine bitumen to address the safety concerns, there is this ban,” said Notley. “We can’t get investors to look at the opportunities, including the upgrade that could address these issues, if there is no room for these products to get through.”
The third area the premier raised in her speech was the acquisition of rail cars. Federal sources suggest they are reluctant to spend hundreds of millions of dollars on rail cars when the problem is likely to be resolved when the Line 3 pipeline becomes operational late next year.
Notley rejected that argument. “They need to do more homework because Line 3 solves the problem for a short period of time. The previous plan was that Line 3 would solve the problem for long enough until TMX (Trans Mountain) came into play. But what we know already is that TMX has been delayed by a year, at best. We also know there has been a decision in Montana impacting KXL (Keystone XL pipeline). We don’t know the impact of that but we do know there has been a negative decision. So in both cases, the idea that the problem disappears with a lovely puff of angel dust in December 2019 is not correct. The intensity of the problem we’re seeing now is a problem that could plague the industry until we get a second pipeline in place,” she said.
I concluded by asking if she thought Justin Trudeau cares about Alberta, given the lack of Liberal MPS in the province?
“I can’t speculate on behalf of the prime minister. What I know is that the health of Alberta’s economy is going to show up on Bay Street, it’s going to show up in indicators for the country, for which any national leader is going to have to account. There is no path to victory for any politician who thinks we can build a Canadian economy by shutting down our resource industries,” she said.
“There is a tremendous level of frustration and anxiety in Alberta, based on the fact we are in a crisis situation. I give the federal government credit for a job well started. But it is not a job well done because they are responsible for inter-provincial transportation of goods, and at the end of the day, we have a significant bottleneck and a significant loss for what we are able to get for this commodity.”
There may be little political upside for the Liberals in Alberta but there does appear to be a realization in Ottawa that the federal government needs, belatedly, to bolster Notley’s position, if only to forestall the prospect of Premier Jason Kenney.
THE IDEA THAT THE PROBLEM DISAPPEARS ... IS NOT CORRECT.