Kenney’s got bigger problems than Trudeau or Greta

Alberta is in trouble economically not because Tech Resources pulled their application on the Frontier mine project, but because Premier Kenney and the Conservative Party of Canada choose to ignore the reasons given by the company for pulling their application.

Tech’s Chief Executive Officer, Don Lindsay, placed the blame on governments (federal and provincial), saying, “Canada doesn’t yet have a clear framework to reconcile resource development and climate change.”

Businesses do understand Canada’s federation and the risks of investing when energy provinces, the official opposition and the federal government are at loggerheads over an issue (climate warming) that has been settled in the minds of the majority of the world.

Tech Resources has always been clear, they needed a partner to share the financial burden of such a large project.

Whether it’s fair or not, the huge liability around tailings ponds and the higher carbon emissions from oil sands production, dispute the industry’s continuing reduction of per-barrel greenhouse gas (GHG), are still viewed as a risk that global investors aren’t prepared to take.

The world’s biggest multilateral lender, the European Investment Bank, will not invest in fossil energy projects after 2021, and Norway’s US$1 trillion sovereign wealth fund has stopped all investments in fossil fuel industries.

Sweden’s central bank sold off Government of Alberta bonds because of our large carbon footprint.

BlackRock, the world’s largest asset manager, has started a fund that excludes all companies that generate any revenue from coal or oil sands.

American capital is chasing cheap, home-grown shale gas plays.

This is today’s reality and it’s not a left-wing plot or a Greta coup.

There actually are 20 oil sands projects in Alberta that have received regulatory approvals.

If all went ahead, it would have the same employment and revenue impact on Alberta as the Frontier mine but much quicker.

It’s a foreign investment issue.

Kenney’s solution, take control of pension assets and all available capital dollars in AIMCo, Alberta’s Investment Management Company, and invest in fossil fuel projects that international monies won’t touch.

An alarm should be sounding when we put even more of our eggs in one economic basket.

For our own good, Alberta must turn a corner and stop the hate-on for former Prime Minister Pierre Trudeau and the National Energy Program.

The 1980s argument was about policy jurisdiction between the provincial and federal levels and who got the lion’s share of the nonrenewable revenues.

Alberta won that debate and we prospered greatly.

Today the global debate is about saving the planet from catastrophic warming.

Mark Carney, former Governor of the Banks of England and Canada said, “firms that align their business models to the transition to a net zero (carbon) world will be rewarded handsomely.  Those that fail to adapt will cease to exist.”

This reality doesn’t discount the necessity for increased pipeline capacity.

Alberta’s economy and revenues from traditional fossil fuel industries are critical to transition our province into a diversified economy.

Ironically, it was a Liberal federal government and a provincial NDP government that understood this reality and pulled out all the stops to ensure the construction of the Trans Mountain pipeline, even to the point of investing taxpayer dollars.

We must understand that aggressively pursuing a transformative energy and high-tech economy is not contrary to the current goals (or actions) of our large oil sands and energy corporations.

It continues to be Kenney’s inability to understand the message delivered by Tech’s CEO Don Lindsay and other Alberta oil sands CEOs that will eventually strangle Alberta’s future prosperity.

 

B. Schimke

ECA Review

About the author

Brenda Schimke

Brenda Schimke

Schimke is a Graduate with Distinction from the University of Alberta with a BCom degree. She has lived and worked in Alberta, BC and Ontario.

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