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By Maureen McCall for EnergyNow
(More connection and real practical solutions came from Jason Kenney)
It’s always good to get a visit from our political leaders.
A fireside chat, a conversation or a town hall can tell you a lot about their understanding of both your situation and the situation the country is in and tell you a lot about their intentions.
A face to face with a calm and soothing Justin Trudeau yesterday at a Calgary Chamber of Commerce event yesterday leaves one oddly cold and disaffected. He seemed to voice a warm understanding of Alberta’s plight, from well researched notes by his well-manicured and attractive staff. But he leaves you wondering, why doesn’t he get it?
Of course, we love that Canada has two official languages and that as a national leader, the Prime Minister communicates to all Canadians in both official languages. But it was problematic that he delivered one quarter of his speech in French to a predominantly anglophone crowd.
It seemed a bit disconnected.
According to the most recent StatsCan census on English–French bilingualism rates in provinces outside Quebec, only 6.6% of Albertans are bilingual English -French. So, a good part of his address -parts that contained important information on G7 free trade agreements or on government intentions to reform our regulatory process were not immediately understandable to most likely more than 80% of the room.
In addition, that quarter of his address included acronyms that were challenging to identify -referring to PTPGP (the Trans Pacific Partnership agreement), L’AECG (Economic and Trade Agreement between Canada and the European Union for Agri-Food Exporters) , and ALENA. (NAFTA). This detracted from his message.
I understand a fair amount of French and I really love French language and culture, but it seemed as if Mr. Trudeau was playing to Albertans’ heroic politeness and sociability. He seemed to be depending on the fact that Albertans would overlook the challenge to communication and continue to politely smile and thank him for coming out.
More seriously, the Prime Minister seemed unaware that by not communicating effectively to the very Albertans he was just “sympathizing with”, he appeared to be insincere. As a result, some of the crowd present at the Chamber of Commerce event yesterday felt an intent to alienate rather than an intent to connect.
A disingenuous tone seemed apparent as Mr. Trudeau tried to draw attention away from his lack of proposals to address critical issues of the price differential, rail constraints and pipeline regulatory confusion and deflect blame to his political predecessors by stating…
“The previous government was very convincing in its positioning as a friend to the oil industry, as a friend to Alberta, and yet they were unable to solve the one biggest top-of-mind [issue] that everyone here was talking about — getting our resources to new markets,” Trudeau said. “It wasn’t just a question of political will. If it had been political will, I’m sure they would have solved it.”
It came across as if he was just trying to avoid taking ownership by spreading blame and discrediting the previous administration.
Not really the way to inspire confidence.
As Mr. Trudeau’s narrative returned to soothing sympathy, he seemed to diminish the current challenges of the Energy sector as merely a regional problem as he stated…
“For a resource-reliant, export-reliant economy like Alberta, global instability has even more of an impact than in other parts of the country.”
Mr. Trudeau preferred to identify issues as regional rather than as issues profoundly affecting Canada’s economy, which is also resource-reliant and export-reliant. He seemed to attribute the cause of challenges to “global instability” rather than identifying the missteps of his administration which are creating a perfect storm of disconnect.
Since Alberta’s contributions to Canada’s CPP, EI and the infamous Equalization payments are substantial, Alberta’s woes have a huge impact on Canada’s economy. They were quantified very well by David A. McLellan, Principal at Ridgeway Strategic Consulting, a professional who provides strategic guidance and business development services to governments and energy businesses in both the US and Canada, who stated in an interview with EnergyNow in October …
“Under the Harper government it’s been calculated that $14,000 for each person in Alberta flowed out of the province and currently it’s on its way to $20,000 due to three primary mechanisms 1. Canada Pension Plan (Alberta has the youngest average age and the highest rate of employment, so it sends the largest amount of CPP payments to Ottawa) Millions more dollars leave Alberta than come in 2. Same with Employment Insurance as Alberta’s employment participation rate is very high- even in the downturn. 3. Equalization payments-they get the most attention, but it’s the lesser of the 3 payments.”
As I listened, I began to wonder…”Why does this speech feel like a “pat on the head”?”
Ironically, Jason Kenney expressed his concern with similar language in a statement to the press at the event.
“Alberta’s getting kicked in the teeth right now. Part of that is Justin Trudeau’s veto of Northern Gateway, his killing of Energy East, his bungling of Trans Mountain, his surrender to Obama’s veto on Keystone, his Bill C-69, Bill C-48- All of these policies are clobbering this Industry and all he came here with today is empty rhetoric. If Ontario’s auto industry was in full crisis mode, if Quebec’s aviation sector was facing a five-alarm fire, he’d be walking in there with multi-billion-dollar subsidy checks. Just yesterday he announced $600 million dollars in subsidies for media outlets. We’re not asking for subsidies, we’re just asking that he stop damaging this industry. He should have stood up in front of the Chamber today to announce that his government is withdrawing Bill C69 – his “no more pipelines law”, withdrawing Bill C-48 – the “Northern BC Tanker ban”, appealing the Trans Mountain decision to the Supreme Court of Canada, accelerating the consultations around that decision, and suspending his accelerated phase out of the most important rail cars. These are some concrete measures he could have taken that wouldn’t cost us a dime. But all he comes here with is his condescending pat on the head – that he feels our pain while he is adding to that pain through his government policies.”
Surprisingly, Jason Kenney offered more real solutions to Alberta’s woes yesterday than what Mr. Trudeau offered during the Chamber of Commerce conversation. In a much shorter statement, Kenney proposed among other initiatives, voluntary oil production curtailments.
“In the short term, I’ve called on producers in this province, to voluntarily to reduce their production of oil by about a quarter of a billion barrels per day. Already a number of responsible companies have voluntarily reduced production by as much as 180,000 barrels of oil per day. If we can get production down, in total by about 400,000 barrels per day, the expert opinion is that the excess inventories would level out and the price would reset and instead of a $45 dollar differential it would be more like a $20 dollar differential early next year. I’ve called on the Industry to act voluntarily, however, I believe if it does not do so, the government of Alberta should be prepared to consider using the tool that Peter Lougheed developed 35 years ago which is mandatory curtailment to protect the value of the asset that belongs to Albertans. I’m a free market guy, I don’t want to begin there. I’m reluctant to suggest it . But at the end of the day, Alberta taxpayers are losing billions because of the huge inventories. We need to get that under control.”
Kenney brought up an urgently pressing point that will have a negative impact on the rail transportation constraints the Industry is facing. Canada’s transport ministry is currently fast-tracking a phase-out of two models of rail cars for the transportation of crude oil and condensate as oil exports by rail hit record levels. The Minister of Transport Marc Garneau said in a statement that the phase-out will involve all DOT 111 tank cars and unjacketed CPC 1232 cars—cars without thermal protection—and will take place by November this year, instead of April 2020.
According to Kenney….
“The Federal Government is accelerating the phase out of oil cars in train fleets which is going to exacerbate the land lock. I would ask Premier Notley to call upon her close ally Mr. Trudeau to relax the timeline on the phasing out of those unjacketed cars. These (cars) are fairly modern technology. They are in the process of being replaced. But why would we be phasing out those cars now? That would actually reduce the shipping ability of the Industry next year. That’s something that could be done right now, which is to relax the accelerated phase out of the 1232 cars.”
Yesterday, from Mr. Trudeau on the subject of WCS Differential, Rail, Pipelines and Political Risk , Albertans got sympathy and a lot of shrugging from an oddly disassociated leader.
In contrast, UCP leader Jason Kenney offered connection and specific practical solutions. As Jason Kenney concluded in his statement to the press yesterday…“Enough speeches, time for action.”
You decide how they should be scored.
Maureen McCall is a freelance writer and has over 14 years’ experience in the oil and gas industry from operations to land and joint ventures
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