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Oil Patch Insider EnCana top banana in Calgary; There Danny goes again
For 40 years, downtown Calgary has suffered from an edifice complex as the city’s historic core has been turned into a concrete jungle.
It started with the Calgary Tower, once the towering landmark of the inner city, and continued through a series of boom years in the 1970s and 1980s as one skyscraper after another seemingly sprouted overnight, most of them singularly ordinary.
Developers were out to make a fast dollar and tenants didn’t have time for architectural niceties.
Only a handful of the head office towers rose above mediocrity.
Then came EnCana, which has never been known for its self-effacing modesty as it claimed top rung among Canadian-based oil and gas producers, then grabbed No. 1 spot among North American gas producers, and once led all Canadian corporations with its market cap.
After 16 months of intense secrecy, EnCana took the wraps off its new 59-storey tower earlier in October, eclipsing rival Petro-Canada, which has held top spot for a couple of decades at 52 floors.
Dubbed The Bow by EnCana — both because of the building’s shape and its proximity to the Bow River that flows across the northern fringe of downtown — the steel- and glass-clad structure will cost C$850 million to C$1 billion, contain 1.7 million square feet of rentable office space, 200,000 square feet of retail and cultural space and three floors with sky gardens.
Construction is expected to start next summer and take three years, with final occupancy set for 2011.
EnCana Chief Executive Officer Randy Eresman said the “dramatic new office tower will be a premier Calgary workplace, one that will enhance staff recruitment and retention while creating an energetic urban village in our city’s core.”
He said The Bow reflects the growing importance of Calgary and Alberta “from a business and cultural perspective.”
Calgary Mayor Dave Bronconnier raved about the design as “truly leading-edge architecture. … You won’t see another building like this in North America.”
But the wags wasted no time putting their label on the building.
Attracted by the curved design of the building they’re calling it the EnCana Banana.
—Gary Park
There Danny goes again Danny Williams, the premier of Newfoundland, doesn’t seem happy unless he is waging war with the Canadian government … and causing misgivings in the petroleum industry.
Over the last couple of years, the pit-bull leader has ordered Canadian flags to be removed from Newfoundland government buildings in a feud over offshore royalties, gone to the mat with former prime minister Paul Martin and grumped when the new government of Stephen Harper refused to play ball in his campaign for legislation imposing fixed deadlines on the development of his province’s offshore oil and gas resources.
Even Williams concedes his latest meeting with Harper was “heated” when he tried to convince Harper of the need for “fallow field” legislation.
Harper: Canada won’t meddle in free market Harper had previously said his government would not meddle in the free market when Williams tried to enlist Ottawa’s help in his battle with Chevron, ExxonMobil, Petro-Canada and Norsk Hydro over the Hebron oil project.
The partners finally abandoned the venture when Williams demanded a 4.9 percent equity stake and enhanced royalties.
The premier has tried every negotiating trick at his disposal to persuade the Harper government to introduce “use or lose it” legislation to bring the Hebron project back to life.
Harper rejected that approach six months ago, declaring that the impasse was strictly a commercial matter and should be resolved through negotiation.
He said that adopting the Williams’ strategy would undermine Canada’s reputation for providing a “stable investment climate” and could result in costly lawsuits.
Williams, in a rare concession, acknowledged earlier in October that Newfoundland could not impose “use or lose it” legislation and agreed with Harper that the Hebron partners could have sued under the North American Free Trade Agreement if his government resorted to retroactive legislation to strip them equity in the project.
Williams: informal Hebron talks have occurred He also disclosed that the two sides have held informal talks which he hopes will produce an agreement and allow Hebron to proceed. (A Chevron Canada spokesman said there has been no change in Hebron’s status).
While holding out hope that a deal is possible, Williams still locked horns with Harper, when the prime minister visited Newfoundland Oct. 16. Starting out as the genial host, Williams led a standing ovation for Harper when the prime minister spoke enthusiastically about Newfoundland’s energy future.
At the same time, Harper drew the line at any legislative moves to force oil companies to develop oil and gas discoveries by a set deadline or risk having their assets expropriated.
Later, when the two leaders met in private, Williams said the simmering disagreement boiled over.
Harper had nothing to say publicly after the meeting, but Williams went on a full offensive, accusing the Harper administration of being too close to the oil industry.
Williams: oil lobby close to federal government He told the Globe and Mail that he believes the “oil lobby is very, very close” to the federal government.
“They have a significant voice in this government,” he said, referring to the government’s power base in Alberta. “As a result, they’ve dissuaded them from acting.”
A federal spokeswoman said she understood that Williams’ argument was tied to retroactive legislation, which “we won’t consider.”
She said there was no discussion on any forward-looking solutions.
Williams said the federal-provincial agreement that governs offshore development in his region makes Atlantic Canada the only jurisdiction in the world that cannot impose penalties when the industry refuses to develop resources.
He objected to the future of Newfoundland’s oil and gas assets hinging on a “decision from a boardroom in Houston.”
Also in Williams’ sights is the deepwater Orphan Basin, where Chevron (50 percent operator), Shell Canada (20 percent), ExxonMobil (15 percent) and Imperial Oil (15 percent) are currently drilling a wildcat well in almost 8,000 feet of water — a C$140 million gamble that it can unlock the first of four pools which some analysts believe could hold upwards of 885 million barrels each.
Ian Kilgour, Shell Canada’s senior vice president of exploration and production, said recently that results from the Great Barasway well should be known before the end of 2006.
Even if they aren’t favorable that would not put an end to the consortium’s exploration program, he said.
—Gary Park
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