‘Don’t meddle in what is working’

The Canadian petroleum industry’s leading mouthpiece is continuing to press for governments and regulators to confine themselves to changes that keep the sector competitive. Pierre Alvarez, president of the Canadian Association of Petroleum Producers, told an unconventional gas conference that the cost and complexity of regulatory approvals will play a major role in the expected 10 percent drop in gas drilling in 2007 (unless commodity prices rebound).

He said that as the industry moves down the “resource triangle,” costs rise, the demand for improved technology rises, the number of approvals increases and infrastructure demands are unchanged. Alvarez also hammered home his belief to federal and provincial governments that they should decide how, not if development should proceed. He urged the industry to work with governments and stakeholders to reinforce what is working and try to prevent change being made for the sake of change.

“As prices go up, the solution is not to have regulators or governments step in to scare off investments,” he said, adding that neither should they solve political issues over prices. The industry should dedicate itself to “open functioning markets that recognize that the global energy industry is indeed global and that investment matters,” Alvarez said.

—Gary Park