PROFOUND SKEPTICISM REMAINS AFTER TRUDEAU’S ALBERTA TOUR
During a remarkable two- day visit to Alberta by Prime Minister Justin Trudeau, the most telling moment emerged from something that happened in the United States.
It showed beyond doubt that we’re in a new world where Alberta’s energy companies, rather than dominating the landscape, are just one panicky beast in the stampede to an uncertain future.
On Thursday, U. S. President Barack Obama announced his intention to impose a US$ 10 tax on every barrel of oil produced in America, to be paid by the companies, in order to fund green initiatives and rebuild transportation infrastructure.
The idea has a slim chance of passing a Republican- ruled Congress, but it’s still sweet music to every Alberta producer. Canadian oil and gas would instantly be competitive in North America again.
Then came the reaction of both Trudeau and Premier Rachel Notley. They didn’t see a U. S. tax as a route back to competitiveness. It would be more an incentive to stronger climate change action at home.
Asked about the Obama tax, Trudeau didn’t answer directly. ( He can be elusive and impressive at the same time.) Rather, he talked about how, two years ago, he told the Calgary Petroleum Club, “We need a price on carbon.”
His preference is to let provinces do the job, he said, noting that the four biggest, with 86 per cent of Canada’s economic activity, now have carbon prices.
“All around the world, as we saw in Paris, people recognized we need to take concrete action on diversifying our energy sources and moving forward in responsible ways,” he said. He’s looking forward to “hearing more about” the ideas that emerge.
The prime minister said nothing at all about what a U. S. petroleum tax would mean for Canadian oil and gas producers.
Notley got more specific when asked directly about how a tax would relate to competitiveness.
“Should the economy as a whole ultimately end up embracing those things ... of course ( that) would help with our competitiveness. But within time it would also contribute to an opportunity to reduce our emissions even more.”
In effect, a tax on U. S. industry would simply open up more headroom for provinces to raise carbon prices.
Notley said the NDP climatechange policy is carefully calibrated to work in today’s competitive environment, both within Canada and in the U. S. It’s supposed to protect the industry while meeting climate goals, which in turn is supposed to help the industry even more.
The trouble is there may not be much left to protect. Companies are bleeding workers and booking terrible financial results. Even a huge liquid natural gas project in B. C., despite being helped along with prompt approvals, is in trouble after Shell postponed its investment plans.
The industry needs relief now; at the very least, a pause to aggressive government action. The promise of future salvation won’t mean anything if there’s no future at all.
Industry skepticism about Trudeau springs from two specific sources: his refusal to promise his cabinet would approve a pipeline even if the revamped National Energy Board gives it the green light; and his effective veto of Northern Gateway, after the NEB approved it with conditions, by banning coastal tanker traffic.
The Liberals like to claim their new approach to pipelines, featuring much more consultation with affected groups, will take the politics out of approvals.
But after release of the new pipeline- approval guidelines last week, it seems they may be doing exactly the opposite.
Natural Resources Minister Jim Carr will appoint a direct representative to sort out Trans Mountain, even as the NEB winds up hearings.
The government’s refusal to back up NEB findings, even those that come after the board is reshaped, suggests the whole business isn’t regulatory but highly political.
There’s no doubt that this prime minister wants to help Alberta. His promises of financial aid come with pleas for the nation to pitch in and help Alberta.
This Trudeau doesn’t want a national unity crisis. Given the family history, it’s easy to see why.
So yes, the prime minister does want Alberta to prosper again. It’s just very hard to see how that’s going to work.