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Offshore ruling ‘should’ happen in 2006 Canadian cabinet minister hopes issues will be resolved within a year Gary Park Petroleum News Calgary Correspondent
British Columbia can’t count on a never-ending world hunger for its resources and can’t expect an early decision from the Canadian government on ending a 33-year ban on oil and gas exploration of its offshore, said Canada’s Industry Minister David Emerson.
He said the resource-dependent economy floats “like a small boat on the ebb and flow of global economic conditions … (and) cannot manage demand.”
The province must “avoid getting caught in the illusion that because demand is good today … that we don’t have to worry any more.” To that end, the Canadian and British Columbia governments must cooperate in ensuring the province’s ports, airports and railway system work smoothly to build on British Columbia’s current competitive advantage, Emerson told an economic forum in Vancouver March 30.
Beyond that there is nothing British Columbia can do to prevent the world’s appetite for its products from eventually declining. For those counting on an economic lift from the offshore, Emerson sent out a mixed message — don’t give up hope of an end to the federal moratorium, but don’t expect a decision before next year.
“We should be able to make a decision by 2006,” he told reporters after his speech.
Emerson said he hopes extensive negotiations between the two governments will answer all of the unresolved issues, although “I think it will take more than a year.” A number of issues on the table Issues on the table involve aboriginal land claims and what role First Nations would have in the decision-making process, British Columbia’s bid for a single federal-provincial agency to regulate the region, a regime to cover royalties and taxes, decisions on which areas would be open for exploration, how exploration rights and tenures would be granted and an environmental assessment of all offshore activities.
Emerson, representing a Vancouver-area constituency in the House of Commons, gave one indication of his leanings.
“We can’t bury our heads on the offshore (which) is an enormous potential opportunity for British Columbia,” he said, referring to estimates that the offshore could have resources of 43 trillion cubic feet of gas and 10 billion barrels of oil, although the Royal Society of Canada has set the recoverable level at 9.8 tcf of gas and 1.3 billion barrels of oil. British Columbia Energy and Mines Minister Richard Neufeld told Petroleum News in March that he is optimistic the federal government will “see their way clear to work with us.”
Talks so far have included several high-level federal cabinet ministers — Emerson, John Efford (natural resources), Stéphane Dion (environment), Andy Scott (Indian and northern affairs) and Geoff Regan (fisheries and oceans).
Neufeld made it clear that removing the moratorium is a lesser priority at the moment than the British Columbia government’s own work to develop an offshore regulatory regime and negotiate agreements with First Nations.
“I don’t put a time frame on lifting the moratorium,” he said. “If we lifted it tomorrow, what would we do then?”
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