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Softening a hard line Canadian cabinet minister acknowledges government faces ‘huge challenge’ to get public support by showing environmental concern Gary Park For Petroleum News
Canada’s Natural Resources Minister Joe Oliver has dropped hints that his government is paying greater heed to public concerns about crude pipelines across British Columbia to open up markets in Asia.
Speaking to the same energy summit in Calgary, David Jacobsen, the United States ambassador to Canada, has offered a comforting message to Canadian producers that their crude will continue to be needed even if the U.S. achieves net energy self-sufficiency.
For Oliver, it was a shift to a kinder, gentler stance from his more jarring remarks earlier this year when he described environmental critics of projects such as Enbridge’s Northern Gateway pipeline as “foreign radicals” — a label he now says was “mischaracterized” because he was referring only to “some groups.”
Following meetings with two key aboriginal leaders and his reference to First Nations as “partners” in resource development, he said: “We want them to derive benefit. We want them to be part of the process.”
At a time of growing public opposition to Northern Gateway, Oliver said “facts and information are crucial but they are not enough.”
He said the public must be convinced that the government is working “to protect Canadians and to protect the environment and that we care about those issues. We’re with them when they express their love for the natural beauty of this fantastic country.”
Social license needed “If we don’t get people on side, if we don’t get the social license (to approve projects) ... there is a big problem,” Oliver said, acknowledging the government faces a “huge challenge” in dealing with the issues and “looking at all the alternatives at the same time.”
As part of weighing alternatives, he endorsed the proposals by Enbridge and TransCanada to open up crude deliveries to Eastern Canada, giving refineries the chance to replace high-cost imported foreign crude with domestic volumes, creating an opportunity for jobs and possibly reducing gasoline prices.
“In addition, there is the potential advantage that people will see a direct economic advantage and build a broad national consensus about development,” Oliver said.
He said the east-bound pipelines will benefit from shorter regulatory reviews because much of the pipe is already in the ground, although a mirror image of the opposition to pipelines in British Columbia is rapidly taking shape in Eastern Canada.
Oliver said there is a “once in a lifetime opportunity” for investors to participate in the buildup of Canada’s resource projects over the next 10 years, with 650 projects worth more than C$650 billion either under way or planned.
He pointed to a fresh approach by the government to help Canadians understand the importance of resource development to their lives and prosperity.
Jacobsen added to that thrust by assuring Canadians he sees a continuation of two-way energy trade between Canada and the U.S. that now carries a value of more than C$100 billion a year.
“Establishing energy independence in North America opens doors for the United States and Canada. What we haven’t done and what we don’t intend to do is close those doors,” he said.
Imported crude will be needed In its annual forecast in mid-November, the International Energy Agency, IEA, said the U.S. could come close to energy self-sufficiency by 2035 partly because of the boom in development of unconventional light oil resources such as the North Dakota Bakken.
It also estimated that Canadian oil sands output could nearly triple over the same period to 4.3 million barrels per day, raising questions about whether those volumes would still be needed in the U.S.
However, IEA chief economist Fatih Birol said in a Nov. 26 speech in Ottawa that the U.S. would still require imported crude in 2035 even as it built a surplus in other forms of energy.
Jacobsen was unable to provide assurances that TransCanada’s planed Keystone XL pipeline from the Alberta oil sands to Texas Gulf Coast refineries will receive approval from Nebraska regulators and the U.S. State Department and ultimately be granted a presidential permit.
“We have been working in parallel with the efforts of Nebraska — we’re not sitting around waiting — and hopefully, relatively soon after Nebraska acts (before the end of 2012), there will be a decision on a presidential permit,” he said.
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