Energy industry attempts to woo Quebec

As a national debate intensifies over whether oilsands development is in Canada’s economic interest, the Alberta Enterprise Group is striving to win over the group of Canadians that polling figures show are least likely to support growing bitumen production in northern Al- berta — Quebecers.

The industry organization’s trade mission next week to Montreal and Quebec City also comes as Canada’s two leading pipeline companies openly discuss ambitions to move oilsands bitumen to refiners in la belle province.

A delegation of Alberta companies including oilsands firms will meet a diverse group of Quebec business people and political players with the aim of growing trade. As part of the mission, Canadian Oil Sandsltd. president and CEO Marcel Coutu is expected to tell a Montreal Board of Trade luncheon next Wednesday about the sustainability efforts of Syncrude Canada Ltd., an oilsands partnership in which his company is the largest shareholder, as well as Syncrude’s business with Quebec suppliers.

Part of the purpose of the Alberta mission is to dispel strongly held misconceptions about Alberta’s largest industry, the oilsands, said Alberta Enterprise Group vice-president David Maclean.

“There’s a lot of misunderstanding, misinformation in Quebec about Alberta’s oilsands development,” Maclean said.

“For example, it’s not at all known in Quebec that Alberta has a carbon tax.”

Quebec, Alberta’s second largest trading partner after Ontario, according to the industry group, is heavily invested in the oilpatch through its pension funds, though many don’t realize that, Maclean noted.

The Alberta group’s message is unlikely to resonate beyond a business audience, cautioned veteran investor Stephen Jarislowsky.

“I don’t think the average Quebecer really concerns himself with the stock market much or what goes on outside Quebec,” said Jarislowsky, chairman of Montreal investment firm Jarislowsky Fraser Ltd., which has large positions in such Calgary energy companies as Nexen Inc. and Suncor Energy Inc.

Beyond having to overcome a propensity in Quebec to shun anything but “green energy” — thanks to the prominence of hydroelectric power in that province — the Alberta group will encounter a population occupied with student protests over a proposed post-secondary tuition fee hike, Jarislowsky said.

The visit comes after a week of political wrangling across Canada following federal NDP Leader Thomas Mulcair’s assertion that oilsands are inflating the loonie to the detriment of the country’s manufacturing sector. The NDP under Jack Layton made strong inroads in Quebec during the last federal election. Alberta Premier Alison Redford and Saskatchewan Premier Brad Wall blasted Mulcair’s comments and on Friday, federal Finance Minister Jim Flaherty said Mulcair’s logic was off.

Laval University economics professor Stephen Gordon said debate over the so-called “Dutch disease” Mulcair complained of hasn’t raged in Quebec, where discussion on the oilsands is centred on the environment. Gordon said the issue might be solved by a properly priced carbon tax.

“I don’t think a carbon tax would shut down the oilsands. It might slow it down,” Gordon said.

Poll results have shown Quebecers have the most negative view, among Canadians, of the oilsands.

Only 37 per cent of Quebecers believe oilsands development is more positive than negative, the lowest approval rating in Canada.

In contrast, 80 per cent of Albertans approve of the oilsands — the highest such rating in Canada, according to an Ipsos Reid poll released this month. The same poll found Quebec had the smallest proportion of people (55 per cent) who believed increased oil and gas development could coincide with protecting the environment, compared with the highest proportion (80 per cent) in Alberta.

A similar question on support for oil and gas development posed last year by polling firm Harris Decima found that of those Quebecers opposed, 74 per cent said a reduction in environmental impacts would make them change their minds.

Still, it’s better to focus marketing the oilsands in the east on promoting the industry’s potential economic impacts on the country over environmental issues, said Harrie Vredenburg, a professor of strategy and the Suncor Energy chair at the University of Calgary’s Haskayne School of Business.

Alberta’s shortage of skilled labour in the energy sector should mean migration west, and a decline in U.S. demand for goods manufactured in the East should prompt a supply shift to meet western energy development, Vredenburg said, adding that proposals by Transcanada Corp. and Enbridge Inc. to reconfigure pipelines so oil flows from Alberta to Quebec should mean eastern Ca- nadian job creation and cheaper oil and gas in Ontario and Quebec.

“Eastern Canadians have to recognize where their stake is and that it’s the Canadian oilsands and not the Alberta oilsands,” Vredenburg said.

Opinion is split on national spinoffs from the oilsands, trumpeted by industry groups and some economic think-tanks but downplayed by other economists, the government of Ontario and environmental groups.

The Alberta Enterprise Group’s trip, from Tuesday to Thursday, is part of the Edmonton organization’s so-called Canada Connects effort and follows past missions to Ottawa, Washington and Geneva.