An aerial view of Kinder Morgan's Trans Mountain Marine Terminal in Burnaby, BC, is shown on Tuesday, May 29, 2018. The Canadian Ministry of Finance says the government has paid "etiquette price" for the pipeline project Trans Mountain when it bought the Morgan pipeline for $ 4.5 billion.
Earlier this year, Canada's Parliamentary Budget Department released a report that should have informed Premier Alberta, Rachel Notley, and Prime Minister Justin Trudeau how expensive it is to delay large projects.
The Jan. 31 report states that a one-year delay in completing Trans Mountain's Expansion Project (TMEP) – which the federal government bought for $ 4.4 billion in August 2018 along with the current Trans Mountain Pipeline – "would reduce the value of TMEP by US $ 693 million. "
You would think, then, that the Feds would pay attention when it comes to reducing bureaucracy for every major infrastructure project. But this is not the case.
Prosper Petroleum president and CEO Brad Gardiner says he almost choked on coffee when he read a recent Notley political announcement Tuesday morning.
"She actually wrote:" The (Jason) Kenney plan leaves our oil on the ground. "I mean, it's annoying," he said of Notley's statement.
No wonder Gardiner feels that way. His company – a 97 percent owned Alberta company – has been waiting five and a half years for his oil sands project to go through the regulatory process to start his SAG-D project of 10,000 barrels a day. A 2013 provincial government report said: "Construction is expected to begin by the end of 2015, with the first oil in early 2017."
But then the NDP came to power. Gardiner, a civil engineer, says that if he believed in conspiracy theories, he would assume that the Alberta Energy Regulator "was doing everything it could to slow it down."
For example, on April 28, 2017, after the EAR started an undue delay of six months, a hearing was scheduled for July 18. That hearing was postponed because the Fort McKay First Nation – which is trying to stop the bill in court – called for the July date. So the nation of 700 people – which is more than 100 kilometers away from the project site – called for the hearing to be suspended until September 2017, which was initially granted. But that date was also postponed again until October 17, "because one of the AER commissioners was on vacation for six weeks from the last week of August."
Now the oil company waits for more than 10 months for Energy Minister Marg McCuaig-Boyd to sign an order in the council (OIC) for a process that normally takes 20-30 days.
On June 12, 2018, the EAR determined that the company's Rigel project was in the "public interest", subject only to the minister's ICO.
Gardiner says that Fort McKay First Nation was allowed to appeal the AER-based decision of the Notley government that did not complete the Moose Lake Access Management Plan that Environment Minister Shannon Phillips ended in April 2016. The appeal does not affect the decision. approval of the EAR or prevent the government from issuing the order in the council.
The company wrote many letters and made several phone calls to McCuaig-Boyd's office, Phillips' office, and even the Premier Notley office-usually without the courtesy of an answer. Even legal letters were ignored. Similarly, McCuaig-Boyd and Phillips did not respond to Postmedia's requests for comments for two days.
"Premier Notley's claim that she feels the pain rings of Calgarians completely empty for me," Gardiner said.
So far, Prosper has spent $ 60 million to applications, scientific studies, legal fees, etc. to meet numerous regulatory obstacles. The delay itself costs money as well as missed opportunities.
This is also costing Albertenses and Canadians dearly. Using a Statistics Canada model, the Canadian Association of Petroleum Producers (Gardiner is on the board) estimates that the project would add 10,812 full-time equivalent jobs during the construction phase, would add $ 1.43 billion of GDP to the economy during the construction phase, creating 1,603 permanent jobs, raising GDP by $ 665 million and providing $ 2.3 billion of revenue to the provincial government over the life of the project.
With the high unemployment rate in the city, no doubt many Calgarians would have coveted high-paying jobs.
The Czech-based Petrolama Namur Oil Sands Exploration – which has partnered with Prosper investing in its 100,000-acre lease, located about 85 miles northwest of Fort McMurray – is also frustrated by the delays.
"Based on the historical processing times for these types of applications, I told this partner we can expect 12 to 18 months and now we're looking at 5 ½ years, and the Czechs are saying," We think the Canada was a safe place to do business and had predictable rules that the government really follows, "Gardiner said.
"Their quote is:" The PDN is worse than the Communists " (who ruled the former Czechoslovakia for decades) in terms of bureaucracy and backwardness, he added.
Scott Holmes, president of Petrolama Energy Canada, says the company is so frustrated with the costly delays that it submitted a notice of dispute against the province to the Canadian government on March 29 due to the "failure of the Alberta government in a timely manner, grant our Order to the Council, allowing us to proceed with our project. "
Gardiner says that when he read the NDP's announcement, he said to himself, "Where has Rachel Notley been in the last 3 ½ years? Does she think we're going to forget that in this period they did everything they could to defeat us? "
Gardiner recounts the ways in which Notley overcame the problem: the royalties review (which completely cut off investment in the energy industry); bring a carbon tax soon after the May 5, 2015 election, although she never mentioned it during the campaign; apologizing for the oils, calling Alberta "embarrassing cousin"; cancellation of energy contracts; shaking the confidence of investors in general, who saw the $ 100 billion in planned investments flee the province; not objecting when Trudeau canceled the Northern Gateway pipeline; not to object when Trudeau changed the rules of the Energy East gas pipeline that led to its cancellation; saying nothing for months, since the Bill C-69 of the federal government (the project no longer pipeline) was before a committee of the Commons and the Bill C-48 (prohibition of the tanker that only excludes Alberta oil on the north coast of the Pacific of BC); and Appointment of Alberta Energy Opponents for the AER.
Delays cost everyone a lot of money, frustration and jobs. Gardiner and his colleagues hope that they have cost Notley and his government the April 16 election.
Licia Corbella is an opinion columnist for Postmedia. [email protected]