Category Archives: Energy

Jan 02 2015
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Economy, Energy, Politics

Shale gas greets new catchwords in 2015

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There is, as Ecclesiastics declares, nothing new under the sun; there is only the same, old trend, fashion or fad, freshly washed, dried, dressed, shod and shoved, once again, onto the super-highway of human history and told to survive if, indeed, it dares.

And, so, welcome to 2015 my dear “social licence to operate”. May we call you “social licence”? It’s shorter and that might be good for your image. Lord knows you’re going to need all the help you can get this year.

Actually, as shibboleths go, this is not a bad one. It’s not especially jargony. It seems reasonably comprehensible. In fact, New Brunswick Premier Brian Gallant is confident enough in his own understanding of the term, he’s started to deploy it as invocation whenever he talks about the on-again, off-again shale gas industry in the province (which is now off again).

“There shall be no drilling,” he says (or in words to that effect) until the companies responsible for hydraulic fracturing obtain the appropriate amount of social licence to proceed.

To which Corridor Resources’ CEO Steve Moran recently shrugged: “Huh?”

His actual words to CBC News were: “Even the premier when he was asked didn’t really have an answer in terms of what that means.”

Tory Opposition Leader Bruce Fitch concurred, as Premier Gallant attempted to clarify his position, telling the CBC, “We’ll certainly do the best we can to get the pulse, and the sense of New Brunswickers on whether any of these operations. . .have a social license.”

In fact, though, there’s no great mystery around the meaning of “social licence”. The mining industry has plumbed the nuances of its definition for years, or so says the Fraser Institute, an economic and public policy think tank with offices in Vancouver, Calgary, Toronto and Montreal:

“The  social licence to operate (SLO) refers to the level of acceptance or approval by local communities and stakeholders of mining companies and their operations. The concept has evolved fairly recently from the broader and more established notion of ‘Corporate Social Responsibility’ and is based on the idea that mining companies need not only government permission [or permits] but also ‘social permission’ to conduct their business.

Indeed, the Institute states, “Increasingly, having an SLO is an essential part of operating within democratic jurisdictions, as without sufficient popular support it is unlikely that agencies from elected governments will willingly grant operational permits or licences. However, the need for and ultimate success of achieving an SLO relies to a large extent on functioning government and sound institutions. . .Many mining companies now consider gaining an SLO as an appropriate business expense that ultimately adds to the bottom line.”

If all this seems broadly familiar – just another way to renovate good, old “corporate social responsibility” (or CSR) and slap a “priced-to-sell” sticker on the front door – experts in these matters beg to differ (naturally).

“CSR is often too peripheral to the core business model, too much of a side-show, too far from providing real ‘shared value’,” writes John Morrison, executive director of the Institute for human rights and business, in a recent issue of the Guardian online. “Even more fundamental are the false dichotomies that CSR has set up. There’s the voluntary versus mandatory debate, companies that are ‘good at CSR’ are valued regardless of the impact of their core operations.”

What’s more, Morrison insists, “Social licence can never be self-awarded, it requires that an activity enjoys sufficient trust and legitimacy, and has the consent of those affected. Business cannot determine how much prevention or mitigation it should engage in to meet environmental or social risk – stakeholders and rights-holders have to be involved for thresholds of due diligence to be legitimate (sometimes even if these are clearly determined in law).”

Herein, of course, lies the rub.

Like its predecessor and memetic forebear CSR, social license, as a concept, is not especially difficult to comprehend or articulate.

What challenges policy makers, politicians, community representatives and industrial players, themselves, is making it work well or long enough to produce sufficient benefits to satisfy all competing competing interests at the table.

This is rendered all the more complicated by the fundamentally revokable nature of social licences. A company that meets its obligations in one area on any given day may not be deemed to have done the same elsewhere at another time.

Then what?

Under such circumstances, Premier Gallant’s shale-gas moratorium may be the lesser of two evils facing the industry in New Brunswick.

Then again, what else is new?

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Dec 10 2014
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Climate, Energy, Environment, Politics

Canada’s contribution to climate change: More hot air

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In the endlessly inelegant waltz Canada performs with the international community on the dance floor that is global warming, our federal government is again taking one baby-step forward and another giant leap backward.

Environment Minister Leona Aglukkaq travelled to the UN climate-change confab in New York over the weekend to deliver the following message to delegates already bemused by her masters’ bewildering stance on environmental stewardship: The oils sands of Alberta are, in effect, off the table, but Canada will introduce strict, new standards on the chemicals that air conditioners produce.

That’s rich, coming from a cold country; but richer, still, coming from this nation’s environment minister, who must surely know that emissions from such manufactured products produced in China – and exported for sale in the Great White North – account for less than one per cent of our annual GHG load.

It’s a bit like saying that a Ford 150 is better for Planet Earth because it fits more people than does a Toyota Prius. But that is, in fact, the essence of the argument about climate change emanating — has always emanated — from Ottawa since before Stephan Harper grabbed the reins of a gigantic, gas-guzzling sleigh ride to 1950s-style complacence.

As the rest of the developed world has been doing its level best to heed the warnings of climate research, Canada has all but ignored them. Officialdom, in this country, has taken its position on what it deems to be science fiction: Let the nerds worry about the future; for now, which is the here and now, the economy begins and ends with fossil fuel.

Or, as Minister Aglukkaq opined for the Globe and Mail just prior to her cotillion in New York, “What I can say is that it is too early or give a date and target timelines (regarding Canada’s previously stated commitments to reduce its greenhouse gas emissions). It is important to remember that Canada’s commitments are national which means that the provinces and the territories will have to play a role in that.”

Meanwhile, she added, “Our government will continue to work constructively with our international partners to establish a fair and effective international agreement that includes all major emitters, and we remain committed to that”

The problem with this line of argument is two-fold: first, it’s spun from threads of propaganda and, therefore, utterly specious; second, the world’s two largest emitters have already come to such an agreement without Canada’s involvement, let alone concurrence.

And yet, as the Globe reported prior to last weekend’s Aglukkag appearance, “The environment minister is expected to highlight Canada’s action on hydrofluorocarbons, which have been used by the cooling and heating industry since they were forced to phase out ozone-depleting chloroflurocarbons several years ago.”

As Dale Marshall, a spokesman of the group, Environmental Defence, declared for the hungry press, “I would say they (the feds) are showing up with another meaningless announcement. What they need to be regulating is the oil and gas sector, which is the fastest-growing source of emissions in the country.”

Still, the good fellow is only half-right. Certainly, the minister of the environment has delivered another absurd proclamation. That is her purview, after all. But the fact remains that the developed world is hopelessly addicted to fossil fuels, and the only way out of this downward spiral is to cleave to another, less deleterious, dependency.

No state, provincial or local government in North America – which enjoys the fruits of technological innovation as no other in the world does – has properly reckoned that the petrochemical industry is a means to, not the end of, civilization’s next great advance.

What stops an enlightened politician from stipulating the patently sensible? Cheap, accessible, abundantly available oil and gas must be deployed to build even cheaper, even more accessible, even more available sources of environmentally neutral energy.

If, as geophysicists claim, the world contains 500 years worth of exploitable oil and gas reserves, then let it fuel the brainpower required to produce 1,000 years worth of commercially viable clean-energy and clean-manufacturing technology.

And let us begin now, not later – before the waltz we dance with the fate of the Earth becomes the walk we take around the pyre we lit to burn it down.

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Dec 08 2014
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Energy, Oil and Gas, Politics

The goofiness of New Brunswick’s very own Fraggle Rock

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It’s been a long time coming, but fracking has officially become not only the bugbear, the hoary thorn, the bothersome burr in the butt of New Brunswick’s body politic, but also its low, comic relief.

For this, we can thank former Tory Premier David Alward, who, while he was in office,  couldn’t stop yakking about the alleged 70-trillion cubic-feet of gas resting quietly beneath the shoes of all those who still refused, against all common sense, to move to Alberta, where considerations about air, soil and water quality are. . .let’s just say, petrochemically sanctified.

But kudos should also go to our new premier, Brian Gallant, who just can’t seem to make up his mind about a drilling technology that’s been deployed safely in this province for nearly two decades.

Mr. Gallant squeaked out a minor majority of seats for his Grits in last September’s election at the expense of Mr. Alward, largely by promising to put an end to hydraulic fracturing – the practice of blowing water and chemicals into tight plays of oil-and-gas-laden sedimentary rock. A moratorium is in order, he declared. (Except, of course, it wasn’t).

Now, he intends to deliver one – in a manner of speaking.

In an interview with the Saint John Telegraph-Journal last week, he stated, “We had a commitment of having a moratorium on hydraulic fracturing. We will be presenting a mechanism on how we will accomplish that in the net few weeks. Now, whether it will be able to pass or not in the time frame that remains to be seen with how the opposition reacts to this.”

Oh, really, Mr. Gallant? The last time any of us checked, you actually held a majority of seats in the provincial assembly. Or, did you skip over the section in the Liberal party playbook, entitled, “Now that you are premier, here are a few guidelines to keep you from falling on your own sword; subsection 1.0, choking on your own words”?

To wit: Is the premier actually intimating that his moratorium on shale gas development in this province depends on how the provincial legislature’s minority opposition votes on the issue? Because if he is, I can save him the trouble of orchestrating an extensive, tedious debate. So, for that matter, can Bruce Fitch, Tory leader.

“We’re going to expose the gaps that we’ve seen in Premier Gallant’s initial foray into politics,” Mr. Fitch declared in the House last week. “Most premiers come in with 100 days of change. He’s had 100 days of chaos.”

The assessment is, of course, as harsh as it is inaccurate. The new premier has racked a couple of historic wins since assuming the mantle of office this past fall. One, surely, is his courageous decision to bring New Brunswick into the 21st Century on a woman’s right to choose how and when to continue, or terminate, her pregnancy.

Another innovative, though less dramatic, policy change is Mr. Gallant’s determination to open up his $900-billion infrastructure rebuild of the province to the private sector’s technology industries. That sort of thinking hasn’t been in evidence around these parts since former Premier Frank McKenna decided to transform 1990s New Brunswick into a Silicon Valley of the north.

All of which makes Premier Gallant’s position on shale gas development in this province perplexing, if not incomprehensible.

A man this evidently smart, engaged and studious – a man who suggests that a proven technology needs halting even though that same technology can and is safely deployed to keep a potash mine, for example, in operation – purely and simply boggles the mind.

Or, maybe, just maybe, that’s the big joke, the big kahuna of humour in all of this.

The Grits need an exit strategy from its ill-advised promise to the less than half of New Brunswickers who support a temporary ban on fracking. All the reigning Libs need do is appear consultative, inclusive, welcoming in a big-tent sort of way. Oh, dear Tories, won’t you please raise your hackles, sound your trumpets, and get us out of this mess we created.?

Indeed, Freddy Beach, won’t you please send in the clowns?

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Nov 27 2014
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Economy, Energy, Environment, Oil and Gas

Would fracking turn New Brunswick into North Dakota?

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For those of the anti-shale gas, “I-told-you-so” bent, a New York Times piece from last Sunday’s edition about the utter mess – both figurative and literal – North Dakota’s oil and gas regulators are making of their state provides for some delectable reading.

Some of us will peruse the weighty tome (it runs close to 5,000 words) with mock horror and secret delight as we study a jurisdiction so fascinated by the economic promise new, horizontal drilling technologies represent that it has, with few exceptions, thrown environmental caution to the wind of commerce.

As the Times article makes plain, “Since 2006, when advances in hydraulic fracturing. . .began unlocking a trove of sweet crude oil in the Bakken shale formation, North Dakota has shed its identity as an agricultural state in decline to become an oil powerhouse second only to Texas.”

But, according to the newspaper’s independent investigation, using “previously undisclosed” sources of information, “as the boom really exploded, the number of reported spills, leaks, fires and blowouts has soared with an increase in spillage that outpaces the increase in oil production,” partly because (or so the implication goes), “forgiveness remains embedded in the (North Dakota) Industrial Commission’s approach to an industry that has given (the state) the fastest-growing economy and lowest jobless rate in the country.”

When the Times says “forgiveness”, it’s not exaggerating. Its research indicates that, since 2006, the Industrial Commission has collected a little over $1 million in penalties against oil and gas companies found culpable in environmental accidents. That compared with $33 million in Texas – no state of tree-huggers, it – during the same  eight-year period.

In other words, writes the Times, North Dakota is a “small state that believes in small government. . .It took on oversight of a multi-billion-dollar industry with a slender regulatory system built on neighborly trust, verbal warning and second chances.”

Meanwhile, “over all, more than 18.4 million gallons of oils and chemicals spilled, leaked or misted into the air, soil and waters of North Dakota from 2006 through early October 2014. The spill numbers derive from estimates, and sometimes serious underestimates, reported to the state by the industry.”

This is, of course, just the kind of thing opponents of shale gas development in New Brunswick fear: The ready collusion (or, at least, the appearance of one) between those who would rape the good earth for its booty of fossil fuels and those who are empowered by law to protect the environment from such ritual violations.

After all, they insist as they point to their smudged copies of last week’s Times, if it can happen in North Dakota, it can just as easily happen here.

In fact, they’re not entirely wrong.

The slope to ecological perdition is, indeed, slippery, made all the more so by the oil and gas industry’s unquenchable thirst for growth. When a province, like New Brunswick, or a state, like North Dakota, believes it has few options to forestall economic collapse, it will, more often than not, sell out to the highest bidder with the fanciest drilling technologies and most accessible checkbooks.

Still, when a province or state has more things going for it, economically speaking, than simply its natural resources, there’s little temptation to relax regulations and oversight to buffoonish parodies of themselves.

The question is whether New Brunswick is anything like North Dakota?

In fact, there may exist some disturbing similarities between us. Over the years, we’ve both suffered from stubborn levels of underemployment, a perennial skills drain, a creeping fiscal morass, declining public revenue, and outmigration.

But our differences make a far more compelling argument that New Brunswick is better equipped than its American doppelganger to stick to its regulatory guns.

We have a history of protest against shale gas, especially hydraulic fracturing; North Dakota does not. We have a tradition of strong, involved central government; North Dakota likes to have its libertarian pie and eat it, too.

What’s more, New Brunswick already has, in place, a reasonably strong set of regulatory injunctions, starting with a moratorium (or, rather, the threat of one) on tight oil and gas drilling until the current Liberal government is satisfied about its safety.

All of which, perhaps, affords us the moral authority to tsk and cluck at our friends south of the border. They blew it.

But their bad examples should not lead us to assume that we are doomed to set our own, should we ever get around to believing in ourselves again.

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Nov 27 2014
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Economy, Energy, Oil and Gas

The perils of East Coast pipeline politics

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On the energy front, perhaps we should not have been so quick to assume that Maritime economic priorities neatly dovetail with those of Ontario and Quebec. After all, when have they ever?

Indeed, if there was a time when political leaders in New Brunswick considered  TransCanada’s eastbound pipeline project a slam-dunk, that time is over, which leaves the province’s new Liberal premier Brian Gallant with yet another post-election migraine.

According to a Globe and Mail report last Friday, “Quebec Environment Minister David Heurtel sent a letter to (TransCanada) chief executive officer Russ Girling laying down seven conditions (the company) must meet to win the province’s support for the (Energy East) project. With his letter, Mr. Heurtel established conditions similar to those adopted by British Columbia Premier Christy Clark for Enbridge Inc.’s controversial Northern Gateway pipeline that would deliver oil sands bitumen to Kitimat for export to Asia, though his tone was somewhat more agreeable than Ms. Clark’s has been”.

Specifically, “Mr. Heurtel’s conditions include the need for public acceptance of the project, for proper consultations with First Nations, and for clear economic and fiscal benefits for Quebec, as well as assurances to gas customers. Mr. Heurtel also cited a National Assembly resolution demanding the government assess the impacts of ‘upstream”’GHG emissions – those produced by extracting the oil – for the pipeline that would carry 1.1 million barrels a day of western crude to market. But he was vague on whether the government will assert the right to block the pipeline.”

Ontario, too, wants environmental assurances and pledges from TransCanada that its newfound interest in shipping western bitumen through its territory en route to Saint John’s refinery will not overwhelm priorities to make supplies natural gas available to central Canadian industry.

Meanwhile, Premier Gallant is scrambling to put the new developments in the best possible light. “I will meet with Quebec Premier Philippe Couillard to talk about the fact that we are certainly behind the project,” he told reporters on Friday. “For us, what’s important is to assure when we can do it in the most safe and secure way possible. It’s one of the reasons why I read about the project at length two years ago. When we put the project into motion, I was already aware that we can do this in a secure way.”

Of course we can. But that’s not really the point. These days, pipelines are symbols of industrial rapacity and environmental carelessness. As such, they are marvelous for galvanizing public opinion against any expansion of the fossil fuel industry, as Maude Barlow, no shrinking violet on the subject, demonstrated last year.    

Regarding the Energy East proposal, the national chairperson for the Council of Canadians, told her interviewer from the North Bay Nugget,  “I want to let communities know not to be pressured to make a decision or risk not getting the benefits of the pipeline. I can tell you there are no benefits. There’s no argument for this pipeline. It’s an export pipeline and we don’t need it. . .We get the risk and (oil companies) get the reward,” adding “I would like to know what are the big jobs, because this pipeline is for export. It’s about greed. They’re playing with a potential environmental catastrophe that environmentalists have been warning about. . .It’s so much more dangerous (than any other oil) and it’s crossing watersheds and many waterways around the Great Lake Region that are already being threatened. We certainly don’t need to add to that threat.”

Naturally, TrabsCanada couldn’t let that go. It responded with its own statement:

“Quebec and New Brunswick currently import more than 700,000 barrels of oil every day – or 86 per cent of their refinery needs – from countries such as Algeria, Iraq, Saudi Arabia and Nigeria. At current oil prices, this is over $75 million drained out of the Canadian economy – every single day. Energy East proposes to connect Western Canada’s resources to Eastern Canada’s needs. Greater supplies of domestic crude would improve the financial viability of eastern Canadian refineries by giving them access to less-expensive, stable domestic supplies.”

Of course, for Mr. Gallant, it could be worse. He could start talking enthusiastically about shale gas.

Let the protests commence.

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Nov 19 2014
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Energy, Environment, Politics

Canada’s climate chickens now come home to roost

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For months, even years, Prime Minister Stephen Harper has insisted that he is as environmentally friendly as the next guy, and so is his government.

In fact, with the leader of Canada’s largest trading partner, he has played a high-stakes game of truth or dare. Just as soon as U.S. President Barack Obama announces a convincing program to dramatically reduce industrial greenhouse gas emissions, he has said, so will he.

Now that the former has done just, to the surprise of the developed and developing world, alike, it remains to the latter to answer the only question that matters on an inexorably warming planet: Now what, Captain Canada?

Indeed, the policy change south of the border, announced last week, is not merely surprising; it’s stunning. The new U.S.-China joint agreement would see the Yanks cut GHG output 26 per cent from 2005 quantities by 2025. The previous commitment had been a reduction of 17 per cent by 2020, a target the Americans are, in any case, quite likely to hit.

The Chinese, meanwhile, have thrown themselves into a multi-billon-dollar build-out of renewable energy technologies and production facilities (including, it should be noted, nuclear) – an initiative that should help them fulfill their new pledge to cap the production of GHGs to levels comparable with the United States by 2030.

Why this accord, and why now?

As different as are their respective political conventions, economic institutions and societies, the U.S. and China still share one embarrassing habit in the arena of energy production: their relatively heavy use of coal, a fossil fuel that makes oil and particularly natural gas seem, by comparison, pristine.

According to the Centre for Energy and Climate Solutions, “In the United States, coal is the third-largest primary energy source, accounting for 18 per cent of all energy consumed in 2012 with the electric power sector accounting for 91 per cent of U.S. coal consumption.

“With the highest carbon content of all the fossil fuels, carbon dioxide emissions from coal combustion represented 24.5 per cent of total U.S. greenhouse gas emissions in 2012. . .Globally, coal is one of the most widely distributed energy resources with recoverable reserves in nearly 70 countries. The U.S., China, and India are the top producers and consumers of coal. Worldwide, coal supplies 29.7 per cent of energy use and is responsible for 44 per cent of global CO2 emissions.”

Of course, given the most recent news from the front lines of the global-warming wars, some sort of U.S.-China compact on the issue was not entirely unexpected.

Earlier this month, the United Nations’ Intergovernmental Panel on Climate Change issued its fifth word on the subject in as many years. It makes for chilling reading.

Reported the Guardian: “The new overarching IPCC report builds on previous reports on the science, impacts and solutions for climate change. It concludes that global warming is ‘unequivocal’, that humanity’s role in causing it is ‘clear’ and that many effects will last for hundreds to thousands of years even if the planet’s rising temperature is halted.”

Added Bill McKibben, a climate crusader of the first and most popular order, in the piece: “For scientists, conservative by nature, to use ‘serious, pervasive, and irreversible’ to describe the effects of climate falls just short of announcing that climate change will produce a zombie apocalypse plus random beheadings plus Ebola. . .Thanks to the IPCC, no one will ever be able to say they weren’t warned.”

No, they won’t, Mr. Harper. So, again, what say you?

The federal government’s reduction target, even before the new agreement between its two biggest export markets, was doomed from the outset. Only the rosiest prognosticators suggested that a 17 per cent cut in GHGs from 2005 in this country had a hope in Hades of materializing by 2020. The reason is simple.

This government’s political and ideological capital is invested entirely in the success of the western tar sands. That’s where it wants derelict Canucks from the East and the Centre to work. That’s where it wants to find its tax revenues and corporate royalties.

It cares very little about anything else that might have been considered, at some point in the elegiac past, authentically Canadian.

The Tories’ current conundrum is that the world, through the U.S. and China, is beginning to turn a corner (late, perhaps) that might well leave their atavistic thinking behind, along with their government.

They just might be thinking about using the fuel in the ground to build the infrastructure necessary to, one day, abandon it forever, except as seed for renewable manufactures.

Then what, Captain Canada?

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Nov 11 2014
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Business, Energy, Environment, Government, Oil and Gas

A moratorium that’s missing in action

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Something has put the swagger back into Steve Moran’s step. The CEO of Corridor Resources is pulling his best impression of Mad Magazine’s mascot, Alfred E. Neuman, these days. What, him fret?

“We’re a little bit worried about the short term, but over the long term, no, we’re not as concerned,” he told the Telegraph-Journal last week, regarding the New Brunswick government’s decision to slap a moratorium on hydraulic fracturing in shale gas development.

“We think government officials understand the potential of the resource here and we think that once they feel they have addressed their issues in terms of health and safety that they will come around and that we’ll be back to work. . .We are confident that, over time, we will work our way through this moratorium.”

All of which raises an interesting question: What moratorium would that be?

The new Liberal government of Brian Gallant has been threatening to level a temporary ban on fracking since long before their election win.

Indeed, it’s not too hyperbolic to say that more words have been expended on the potential perils to human health of hydraulic fracturing than there has been gas extracted from the ground.

Here’s the new premier on the subject two weeks ago: “We believe there should be a moratorium on hydraulic fracturing due to the lack of information concerning the risks to our environment, our health, and our water. I think it’s important for people to know what we’re concerned about – it’s the process of extraction called hydraulic fracturing.”

Now, here’s Energy Minister Donald Arseneault just last week at the New Brunswick Exploration, Mining and Petroleum conference: “We have a clear mandate from the people and a very consistent message over the last two years that we want a moratorium on the shale gas industry. We had a clear mandate on election day to move forward on that and that’s what we are going to bring forward in the near future.”

Again, when, exactly, would that be?

In reality, it is not at all clear that the Liberals have received a “clear mandate from the people” on this issue. Some surveys conducted before, during and after the election campaign indicated that the public in this province is deeply divided on hydraulic fracturing. If anything, the edge seems to go to the pro-gas lobby as long as the industry can provide credible, verifiable assurances about its safety practices and environmental stewardship.

Neither is it clear that Messrs. Gallant and Arseneault are singing the same tune, let alone from the same song sheet.

There’s a big difference between slapping a ban on the shale gas industry, as Mr. Arseneault is mumbling about doing, and carefully parsing the distinction between hydraulic fracturing and other methods of resource extraction, as Premier Gallant is wont to do.

One definitively slams the door; the other leaves it open just a crack.

Of course, in this parade of mixed messages, Mr. Aresneault has been a marvelous band leader.

On the tricky position into which any sort of moratorium would put Corridor Resources and its gas customer Potash Corp., the minister weaved for the Telegraph-Journal earlier this month:

“The last thing we want to do is potentially put certain operations in jeopardy. For me, PotashCorp is a major player in New Brunswick. It’s a concern for me. It doesn’t mean that it gives everybody a green light, but it’s definitely in the back of my mind that I’ve got to be conscious and responsible going forward.”

As to the fate of PotashCorp’s new Picadilly mine without ready supplies of fracked natural gas, Mr. Arseneault said, “Those are the questions we are going to be asking the company. If we didn’t impose a moratorium, what is the activity they have planned for the next couple of years? Having a moratorium, how will it impact their operation? Will it impact potash? We haven’t settled on a specific menu other than we know there will be a moratorium.”

But, I wonder if that’s even certain anymore.

Indeed, Steve Moran, is there something you’re not telling us?

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Nov 05 2014
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Energy, Oil and Gas, Politics

How howling from the edges of sanity is good for New Brunswick

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As voices in the wilderness, we raise our rhetoric to match the long, lonely howls that issue from the pits of our guts. We see the future from our perches at the peripheries of Main Street, Freddy Beach, Parliament Hill and, yes, even Wall Street.

And, from that vantage, the future of this province is (trust me) utterly howl-worthy.

We are the pundits of New Brunswick, whose opinions about such things as economic development, social sustainability, energy policy, and fiscal management are sometimes politely acknowledged, but more often violently rejected.

We’re used to it.

Our fellow citizens are, after all, entitled to the pabulum their elected representatives ritually spoon into their pie holes when said representatives promise that their gruel will, in the end, taste like filet mignon.

But when guys like David Campbell, writing for the Saint John Telegraph-Journal, and scribes like Bill Belliveau and Norbert Cunningham, penning for the Moncton Times & Transcript, are routinely vilified for pointing out the patently obvious, and necessarily important, about this province’s. . .um. . .let’s just say “challenges”, I am risibly motivated to whip out my formidable arsenal of wordy invective to level the decidedly unlevel playing field that is the blogosphere.

Then again, what would be the point of that when we have Donald Savoie in our philosophical corner.

The “great prognosticator” issued another in a long line of epistles from his mount at the University of Moncton the other day.

In this one, he wrote, “Whether one likes it or not, the global economy is here and it is highly competitive. New Brunswick has to compete with what it has, not with what it wishes it had. I was surprised (during the recent provincial election campaign) to hear aspiring politicians and observers making the case. . .that we can say no to development opportunities in the natural resources sector and that all we need to do (is) create new economic activities to diversify our economy. How can we do this?”

Good question (though, it is rhetorical).

Allow me, pundit-wise, to take a crack at an answer (though it be unrhetorical).

Posit the following: Natural gas is far less damaging to the environment than any other form of fossil fuel; its extraction technologies for both orthodox and unorthodox plays are proven, safe and reliable; its delivery infrastructure is far less likely to fail and, therefore, pollute than those for crude and refined oil and coal.

Now, acknowledge the following: There is enough shale gas lying beneath the surface of this province to power local economies for decades through extraction, transportation and refining activities, alone. But that is only the outline of the big picture (if we had big-picture thinkers at our various seats of government, they might have paid attention decades ago).

The true, long-term potential of this resource, should we choose to embrace our own economic interests, is technological and innovative leverage.

Even the most committed environmentalists must surely realize by now that transitioning to a fully sustainable, renewable energy future will only succeed when we finally learn how to deploy the relatively cheap energy we harvest from the ground and the sea beds.

Almost every component of a wind turbine, a tidal array, a solar facility, a hybrid automobile, a bloody, backyard greenhouse is a product, directly or indirectly, of refined petroleum, cracked into shape for re-manufacture into the building blocks of plastic, pure and simple. That’s the foundational reality of our industrial economy; it has been for 100 years.

Saying we wish it weren’t so won’t make it go away.

What might, though, over time, is a coordinated, comprehensive public-private partnership to transform New Brunswick into a think tank, industrial test site and centre of excellence for repurposing the world’s excess plastic as the building blocks of sustainable, renewable energy technologies.

From here, the province – with its surfeit of institutes of advanced education relative to its population – could pioneer a global standard for delimiting the use of petroleum products to, in effect, manufacture only those technologies that produce sustainable, renewable, in-situ energy (lamentably, planes, trains and automobiles must be off the table for the time being).

Off course, mine is just one voice in the wilderness of ideas.

Let the vilification commence.

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Nov 04 2014
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Business, Economy, Energy, Oil and Gas, Politics

It’s time to get clear on natural gas

Welcome to the energy big leagues, Mr. Premier.

Wheels upon wheels, gears upon gears, the squeeze play against Brian Gallant’s determination to impose a moratorium on hydraulic fracturing in New Brunswick – the preferred industry method for extracting natural gas, with water, sand and a proprietary soup of chemicals,  from sedimentary rock – has officially commenced.

Not that there’s anything especially surprising about Corridor Resources’ public insistence that 30 of its fracked gas wells supplies PotashCorp’s operations in the Sussex area of the province – to no ill effect on the water, soil and air – with a competitively priced, comparatively clean source of fuel with which to dry the fertilizer for market readiness.

Nor is their anything particularly shocking about PotashCorp’s addendum last week.

“Access to a secure, stable and sustainable gas supply is critical to our. . .longterm success,” New Brunswick General Manager Jean-Guy Leclair told the Telegraph-Journal. “While there are alternate fuel sources for our facility, they would have profound implications on our current and future operational costs.”

Read between the lines, Mr. Premier. That’s a palpable threat. By now, you must know this. What’s mystifying is why you apparently didn’t see it coming.

Or, perhaps, you did, and your hard line in the sand during the election campaign was merely a political gambit to win over some voters.

Maybe your strategists advised you to hold that line for as long as you could and then capitulate only when major industrial players left you no choice.

If I had been one of your back-room boys, I would not have counselled this: Stay true to your principles until such time as the oil and gas lobby intimates major job losses; then reverse course in the broader interests of economic development.

And, in the process, blame the big, bad bogey man of corporate Canada for forcing your hand. “The devil made me do it, folks,” you might plead. “What can I say?”

Whatever is the case, all of it has been poor politics, poorer public policy and a fundamentally bad start for a new government.

And it’s getting worse.

Cabinet solidarity is one of the rocks that grounds leadership in a parliamentary democracy. It tells the electorate that the men and women the premier has chosen has his or her back, and, in the process assures the great, voting unwashed that they haven’t made a colossal mistake at the ballot box.

So, under these circumstances, what are we to make of Mines and Energy Minister Donald Arseneault’s freelance, off-playbook commentary last week?

“I was the minister back in 2007 who struck the deal to attract that investment of $2.2 billion (PotashCorp’s expansion) to New Brunswick,” he told the Telegraph-Journal last week. “We do know that Corridor feeds gas to the potash mines, and for me that is a very important component. . .For me, PotashCorp is a major player in New Brunswick. . .The last thing we want to do is potentially put certain operations in jeopardy.”

Now, we cut to a Page 3 story in the same organ on the same day.

“No,” declared Premier Gallant, “for us, it is a hydraulic fracturing moratorium, and we’re certainly willing to meet with different operations, different businesses, all stakeholders and New Brunswickers to understand the best way to implement this moratorium.”

None of which actually clarifies anything, except that the young premier of this province understands practically nothing about energy politics and, far more troubling, he seems oblivious to the worries of at least one of his important lieutenants – the one in charge of, arguably, the most important economic portfolio.

What now shall we expect? Will a great muzzling commence?

There is a way, of course, to safely and responsibly frack for gas in New Brunswick. We’ve been doing it for years. As long as we adhere to the tightest regulations our democracy provides — with the most comprehensive environmental oversight common sense produces — we have an even chance to reduce our reliance on far dirtier forms of fossil fuel and maybe, just maybe, generate the economic incentive to fully transition into a renewable, sustainable society. There is nothing new in any of this.

What is new is that we, in this fine, elegant, innocent part of the world must face the fact that we need the hard, tough, clear leadership to get us where we need to be.

Welcome to the energy big leagues, New Brunswick.

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Nov 01 2014
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Energy, Environment, Oil and Gas

What’s the fracking story, already?

On the endlessly controversial subject of hydraulic fracturing for natural gas in this province, New Brunswick’s Liberal leadership has, in the span of just one month, gone from reliably hard-headed to unpredictably incoherent.

Here’s Premier-designate Brian Gallant talking to the CBC, following his election win last month: “There will be a moratorium on hydraulic fracturing and those businesses (oil and gas explorers), I’m sure, are not surprised. This has been talked about, discussed and debated as a province for months if not years now. . .I think we have jurisdictions around us where I think we’ll be able to pull some of their experiences, how exactly this should be instituted, what’s the best way to go about it and what are the next steps.”

He even speculated almost sanguinely about the possibility that one or more of the drilling operations might sue the province as a result of his determination to the toe the environmentally expedient line: “(A legal action) is certainly something that could become a reality. We recognize that. We will certainly meet with (shale gas companies) and we will explain why our position is what it is.”

Now, here’s newly appointed Minister of Energy and Mines Donald Arseneault explaining to the Telegraph-Journal this week that he is well aware of the relationship between Corridor Resources and PotashCorp – in which the former supplies the latter with fracked, New Brunswick gas and has for years.

“The last thing we want to do is potentially put certain operations in jeopardy. For me, PotashCorp is a major player in New Brunswick. It’s a concern for me. It doesn’t mean that it gives everybody a green light, but it’s definitely in the back of my mind that I’ve got to be conscious and responsible going forward.”

To which the averagely informed, casually interested follower of the public-policy follies that constitute a permanent entertainment event in Fredericton (regardless of the party in power) might react thusly: Huh?

Does this mean the Grits are backtracking on their promise to temporarily forbid fracking? Or is their position merely, as the spin doctors like to say, “evolving”?

A more urgent question concerns the fate of PotashCorp’s new Picadilly mine without ready supplies of fracked natural gas. “That’s a valid point,” Mr. Arseneault told the T-J. “And those are the questions we are going to be asking the company. If we didn’t impose a moratorium, what is the activity they have planned for the next couple of years? Having a moratorium, how will it impact their operation? Will it impact potash? We haven’t settled on a specific menu other than we know there will be a moratorium.”

Again: Huh?

Dear reader, now to recap:

There will be a moratorium on fracking at some point in the near, to mid-term, to distant, future. But whether or not it will be a comprehensive, province-wide ban or a series of selective prohibitions depends entirely on whether or not the injunction injures the fortunes of one of the province’s largest industries.

In this instance, concern for the water table – the moral justification of the moratorium in the first place – takes a back seat to the more pragmatic realities of economic development.

Then again, the mere fact that Corridor has been operating in New Brunswick without incident for 10 years at least raises the possibility that drilling for tight shale gas – either hydraulically or with propane – can, in fact, be done both safely and responsibly. And, so, the purpose of a moratorium becomes what, exactly?

Mr. Arseneault appears to suggest it’s partly about election-campaign promise fulfillment – the Grit’s analogue to the previous Tory government’s refusal to consider raising the HST even a little just because, while running for office, they said they wouldn’t.

“At the end of the day,” the minister said, “our principals don’t change – we are going to implement a moratorium. I didn’t lie about it (to industry). I made that very clear. But we just need to determine now with the information that we gathered from them and other stakeholders as well as what kind of moratorium we want to implement.”

In other words, just as soon as this new government gets its story straight.

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