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Fixing a ‘deficit’ in bilateral relations EnCana CEO sees energy as cornerstone under new prime minister Gary Park Petroleum News Calgary Correspondent
A new prime minister is about to be installed in Canada and with that change there is the chance for a makeover in Canada-U.S. relationships, with energy trade as the “proven model to build on,” says EnCana President and Chief Executive Officer Gwyn Morgan.
Former finance minister Paul Martin will be formally elected Nov. 15 as leader of Canada’s governing Liberal party and will soon be sworn in as prime minister to succeed Jean Chrétien.
Given Martin’s record of removing Canada’s fiscal deficit, Morgan told a New York audience Nov. 11 he has great confidence that the new leader will “act decisively to remove Canada’s relationship deficit with the United States.”
From this “new, more positive platform” he said the two countries can deal with the many issues that cause friction between the “world’s two most naturally suited allies and most closely knit economies.”
Morgan held up EnCana as an example of how the bilateral dealings can be made to work, noting that his company is the largest producer and exporter of Canadian natural gas to the United States, and its U.S. subsidiary is one of the largest explorers and producers in the United States.
“We have the largest North American oil and gas exploration program of any Canadian- or U.S.-headquartered company,” ranging from Alaska through Western Canada, the U.S. Rockies, Canada’s East Coast and the Gulf of Mexico. Big supply opportunity in Alberta oil sands Canada is already the largest external supplier of oil to the United States at a time when “access to adequate energy supplies is an enormous economic and security issue for the United States ...
“While imports from Canada have grown a lot, so have offshore imports and current trends would make Americans more and more dependent on an increasingly unstable Middle East,” he observed.
With conventional oil sources in the United States and Canada in irreversible decline, Morgan said the “big supply security” opportunity for the United States lies in the Alberta oil sands where “the potential is enormous.”
But to take advantage of that resource the United States needs to increase its pipeline capacity and upgrade its refining capability to handle heavy oil.
“Refineries need to be reconfigured to take more Canadian heavy oil,” Morgan said. “I believe that it’s in the American interest to provide incentives to refiners to achieve this, since it is the biggest single constraint to capitalizing upon the Canadian supply security opportunity.”
On the delivery side, he said Canadian-based pipelines Enbridge and Terasen are exploring more projects out of the oil sands, but they need regulatory support.
“These are crucial actions, but they are relatively simple in the context of what’s at stake in an unstable world. Canada and the United States share a vital interest in their achievement,” he said.
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