Federal minister touts Canada's energy reliability at Global Energy Show
Tim Hodgson tells international delegates Canada is 'open for business,' but oilsands CEO raises doubts about pipeline support.
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Federal Natural Resources Minister Tim Hodgson came to the Global Energy Show in Calgary on Tuesday with a message for international energy delegates: Canada is a reliable, democratic supplier in a volatile world.
"Canada can be a supplier you need in a volatile world," Hodgson told the opening session. "We all know energy policy is now economic policy. It is security policy. It is trade policy. It is investment policy."
The conference, taking place as Middle East tensions rattle energy markets, was expected to attract 30,000 attendees, with a larger portion from abroad than in years past.
But the optimism collided with industry skepticism. Jon McKenzie, CEO of Cenovus Energy, cast doubt on whether the federal government's conditions for supporting a new West Coast oilsands pipeline inspire confidence in producers.
Alberta and Ottawa signed an energy accord late last year setting out conditions for a West Coast pipeline, contingent on the massive Pathways carbon storage project moving ahead. Pathways aims to pipe CO2 captured from oilsands sites in northeastern Alberta to a storage hub near Cold Lake, reducing emissions by 16 megatonnes by 2045.
But McKenzie said the memorandum of understanding and subsequent agreement on a new carbon pricing regime don't provide the certainty needed for investment. "Industry has been clear that the industrial carbon tax is insidious and it should be revoked," he said. "The confirmation of the carbon tax does not provide certainty for investment. It provides certainty that a regulatory regime is increasingly out of step and uncompetitive."
McKenzie estimated a project the size of Pathways would cost $20 billion to $30 billion while reducing global emissions by an infinitesimal amount. "It's difficult to imagine anybody would believe that this is a good use of funds," he said.
The Alberta government is aiming to file an application by July 1 to the federal major projects office for the pipeline, which so far has no private-sector backer.
The tension between government ambition and industry caution frames the challenge facing Calgary as it positions itself as an energy hub in a shifting global market.