Providing coverage of Alaska and northern Canada's oil and gas industry
June 2020

Vol. 25, No.26 Week of June 28, 2020

Kenney on slippery slope, down 17% in approval since April 2019

Gary Park

for Petroleum News

It was only 15 months ago that Jason Kenney romped to victory in an Alberta election that gave him the highest popularity rating of any government leader in Canada. Those heady days are fast becoming a distant memory.

He’s now at the bottom of the heap among provincial premiers, having tumbled from 61% approval to 44% during his time in office, despite attracting high praise for his handling of COVID-19.

In his rush to implement election promises, Kenney rapidly lost favor among Albertans with his budget plans to cut spending by C$4 billion, undermining health care and education in the process, while taking a US$1.1 billion equity stake and offering a US$4.2 billion loan guarantee to secure completion of TC Energy’s high-risk Keystone XL pipeline.

There is little doubt that his United Conservative Party government has gambled heavily on its political capital in a frantic effort to rescue and revive Alberta from its economic plight that now seems destined for historic jobless rates of more than 20%, largely the result of COVID-19.

Push for jobs, revenue

Kenney’s answer is to try almost anything to create jobs and revenue.

His latest ploy is an omnibus bill that involves a sweeping reform of approval procedures for new oil sands projects by slashing 10 months off the regulatory process through 14 changes to legislation that affect six government ministries.

It is accompanied by a proposal to remove the requirement for cabinet to approve royalty rates, turning that responsibility over to the minister of energy.

Former Premier Rachel Notley, who leads the New Democratic Party opposition in the Legislature, said the proposed royalty change is “jaw-dropping,” given that those revenues are “how Albertans get value from the resources that we all own.”

“We cannot have them slip backwards into a situation where we can have backroom deals and backroom conversations with the minister who can, with the flick of a pen, make allowances for different folks,” she said.

Kenney avoided answering Notley’s challenge in the Legislature, but a spokesman for Energy Minister Sonya Savage insisted the minister will “always be accountable to the premier, cabinet and most importantly Albertans” on royalty matters.

He said the new legislation is “not intended to make changes to our royalty structures for oil and gas.”

Reducing red tape

Grant Hunter, associate minister charged with reducing red tape, said legislative overhaul is targeted at improving efficiency and restoring jobs as the government works on regaining economic momentum after the COVID-19 shutdown.

“Unneeded red tape has been stifling Albertans for far too long and it’s put us at a competitive disadvantage to other jurisdictions,” he said. “Now more than ever it’s time to get control of red tape in this province. Our economy needs this boost.

“Time is money, so being able to decrease the time that it takes to get approvals ... is always a good thing for getting Albertans back to work,” he said.

Hunter said the Alberta Energy Regulator, an unelected government agency that controls most aspects of natural resource development, will continue to have responsibilities, including making sure that First Nations are appropriately consulted.

“The duty to consult is still the law and we still have that responsibility,” he said.

Beyond that he floundered when asked by reporters to explain the details of his legislation, deferring instead to the ministers of energy and the environment.

Hunter also said there will no longer be any need for Energy Efficiency Alberta, which was created in 2017 by the New Democratic Party government of Premier Rachel Notley and is now scheduled to close on Sept. 30.

The role of the EEA will be rolled into Emissions Reduction Alberta, which will be shaped by new government ideas to reduce emissions.

AER under fire

The AER recently came under fire from three Northern Alberta First Nations for temporarily suspending a swath of soil, water, emissions and wildlife monitoring in the oil patch.

The First Nations have appealed that action, claiming the regulator’s move was made at the urging of the industry without any attempt to hear from other parties.

Seven environmental and indigenous groups have asked the Kenney government to restart monitoring.


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