Category Archives: Energy

Jun 06 2014
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Climate, Energy, Oil and Gas, Politics

New Brunswick’s climate change talking points

 

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Greenhouse gas emission targets, like New Year’s resolutions, are made to be broken. Still, as loyal supplicants of the state of denial otherwise known as New Brunswick, it behooves all of us to wish Premier Alward and company all the best with their new Climate Change Action Plan.

Luck? You’re going to need it. 

“To do its part under the Conference of New England Governors and Eastern Canadian Premiers (NEG-ECP) 2013 Climate Change Action Plan,” the strategy, released on Monday, declares. “New Brunswick has committed to achieving greenhouse gas reduction targets of: Ten per cent below 1990 levels by 2020; and 75-85 per cent below 2001 levels by 2050.”

Apparently, this is perfectly doable. After all, as the report notes, the province managed to reduce its greenhouse gas emissions by 17 per cent between 2005 and 2010, even as it grew its economy by 19 per cent over that period.

Forget that in 2011, New Brunswick belched 18.6 million tonnes of 

CO2 equivalent, which amounted to the third-highest per capita emissions in the country, behind Saskatchewan and Alberta.

Forget, too, that as the plan clearly states, “New Brunswick’s economy faces challenges due to its high ‘carbon intensity’. In other words, the province consumes a relatively large amount of energy per dollar of economic production, and despite recent 

progress, much of the energy New Brunswick uses still comes from refined petroleum products. With the transition to a lower carbon economy well on its way, people around the world are making significant changes to the way they do business. As a province that exports much of what it produces, New Brunswick’s reputation and real performance in climate change may affect its trade competitiveness in international markets.”

All of which is another way of saying what U.S. Ambassador to Canada Bruce Heyman warned this week: If we don’t soon get our climate-change act together up here, north of the 48th, there will be economic consequences to pay elsewhere on the world stage.

“We need to continue (the) work together moving toward a low-carbon future, with alternative energy choices, with greater energy choices, with greater energy efficiency, and sustainable extraction of our oil and gas reserves,” he said in a speech in Ottawa on Monday. “This is not a task we can take on individually. It can only be successfully challenged together.”

Mr. Heyman made his remarks as his boss U.S. President Barack Obama’s unveiled sweeping, new plans to cut carbon dioxide emissions from power plants by 30 per cent by 2030. 

Again, like New Brunswick’s targets, the number feels arbitrary. Who knows what can happen in five years, let alone 15 or 35? Almost no one foresaw the industrial output-killing Great Recession of 2008, which, incidentally, did more than all the earnest policy makers in the world to reduce greenhouse gas emissions.

Still, it’s a start, and that’s more than we can say for our own venerable leader Prime Minister Stephen Harper, whose only response to criticism this week that he’s not moving fast enough to match US. initiatives on climate change was downright surly: “(Obama is) acting two years after this government acted and taking actions that do not go nearly as far as this government went.”

The unvarnished truth is, however, that the Yanks are on course to cut all of their emissions by 15 per cent by 2020. In contrast, we Canucks are more or less happily sitting with our heads stuck in the Alberta oil sands, where production dooms any hope of meeting our oft-stated reduction target of 17 per cent a scant six years from now.

In New Brunswick, several factors militate against the new action plan’s chances of success. Oddly enough, none of these has anything to do with tight oil and gas development, an as yet unrealized sweet dream, or wretched nightmare, depending on who’s doing the talking.

Without dramatic, even temporarily traumatic, changes to the energy mix in this province – without a concerted effort to cut back usage, conserve electricity and, finally, migrate to renewable sources for in situ consumption – all of our greenhouse gas reduction targets will remain, like so many of our other promises in New Brunswick, made to be broken.

 

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May 07 2014
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Energy, Environment, Oil and Gas

Slow-dancing with shale gas in New Brunswick

 

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Government and industry types, desperate to envision a way out of New Brunswick’s straightened economic and fiscal circumstances, routinely point their fingers to the future and declare it full of shale gas. 

Now, a new report by a group of people that actually knows something about science, evidence and the perils of jumping to conclusions advises us to cool our jets. The future isn’t all it’s cracked up to be.    

The multidisciplinary (and excessively named) Expert Panel on Harnessing Science and Technology to Understand the Environmental Impacts of Shale Gas Extraction, convened by the Council of Canadian Academics at the behest of Environment Canada, warns that not only do we lack adequate information about the effects of tight-play, onshore petroleum production in Canada, most of us are even too ignorant to ask the right questions.

In essence, to paraphrase former U.S, Secretary of Defense Donald Rumsfeld, we don’t know what we don’t know.

“Society’s understanding of the potential environmental impacts has not kept pace with development, resulting in gaps in scientific knowledge about these impacts,” the report says. “In most instances, shale gas extraction has proceeded without sufficient environmental baseline data being collected (e.g., nearby groundwater quality, 

critical wildlife habitat). This makes it difficult to identify and characterize environmental impacts that may be associated with or inappropriately blamed on this development.”

The solution, it appears, is to adopt a go-slow approach, the advantage of which “allow for additional data collection, to permit adaptation to the implications of new information, and to encourage integration of multidisciplinary expertise. . .There may also be some negative impacts of development that cannot be eliminated, and the scientific basis for identifying areas that are particularly vulnerable has not been established.”

None of which is especially good news for the likes of Premier David Alward or his energy czar, Minister Craig Leonard.

For at least three years, they, like most members of provincial cabinet, have been crowing as loudly as they can muster about the extraordinary economic benefits that will accrue from a safe, reliable, environmentally responsible shale gas industry. On this point, they have assembled, drafted, edited, amended and finally released what they claim are the toughest standards and guidelines for shale gas development anywhere in North America.

But, as the report points out, they’re getting woefully ahead of themselves.

Although the panel goes out of its way to acknowledge that the industry in Canada has cleaned up its act in recent years through “recycling (and) reducing land disruption by concentrating more wells at each drilling site, reducing the volumes of the toxic chemicals it uses, and reducing methane emissions during well completions,” it also stipulates that “other impacts, such as cumulative effects on land, fugitive GHG emissions, and groundwater contamination, are more problematic. 

“This is the case because available mitigation technologies are untested and may not be sufficient; scientific understanding is incomplete; and the design of an adequate regulatory framework is hampered by limited information.”

A proper rules system, the experts insist, “must be based on appropriate science-driven, outcome-based regulations with strong performance monitoring, inspection, and enforcement.”

For his part, Mr. Leonard is playing it cool. The report, he says, does nothing to dissuade him from pursuing the current course in the manner he has chosen. Slow down? But, of course, he declares. 

“When people say ‘Slow the process down,’ the fact is we haven’t done anything except for seismic testing over the last three years,” he noted last Thursday, following the report’s release.

“We aren’t going to have any new drilling taking place at least until next year and we probably won’t even have any actual hydraulically fracked wells being drilled in shale formations for a couple of years. So there is time to be building this information.”

And, perhaps, a better consensus across the province. 

Lack of information breeds systemic ignorance, which, in turn, fuels unproductive rancor and fear (as opposes to useful and constructive debate). 

The time this report suggests we purchase for ourselves should be spent educating ourselves about the true and likely impact of shale gas development in the specific geological and geographical conditions that are native to New Brunswick.

Only then will any of us possess the knowledge to accurately foresee the shape of things to come.

 

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May 02 2014
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Economy, Energy, Oil and Gas, Politics

Lessons for New Brunswick from The Lone Star State

 

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In Texas, to quote a phrase, they do things big.

Big sky, big country, big portions, big ambitions all frame the tableau that is The Lone Star State.  So does “big energy”, but not always in a fashion that seems familiar to New Brunswickers embroiled in their own existential debate about natural resources development.

Yes, Texas is synonymous with the oil industry and is home to the famous (or, depending on one’s perspective, infamous) Barnett field, which in one recent year produced 1.11 trillion cubic feet of shale gas. But it is also home to the largest and most successful wind energy industry in the United States.

According to a Wikipedia entry, “wind power in Texas consists of many. . .farms with a total installed nameplate capacity of 12,212 MW from over 40 different projects.” In fact the state “produces the most wind power of any” in the U.S. 

Just as impressive, perhaps, is the speed at which the energy resource has developed there. In a scant 13 years, the state’s annual hours of wind generation by megawatts has skyrocketed from 492,000 to 36 million. How?

Again, the Wiki item is instructive: “The wind boom in Texas was assisted by expansion of the state’s Renewable Portfolio Standard, use of designated Competitive Renewable Energy Zones, expedited transmission construction, and the necessary Public Utility Commission rule-making. Wind power accounted for 8.3 per cent of the electricity generated in (the state) during 2013.”

So, the take-away from all of this is that a happy, productive collaboration between business and government has literally invented a clean, renewable and commercially viable alternative to fossil fuels for electricity generation where none existed at the dawn of the 21st century.

Now, not coincidentally, power rates from wind are among the lowest of any energy source in the state (only those from shale gas are cheaper). 

Even better, the billions of dollars the private sector has invested in the industry to become competitive and profitable has spurred economic development in rural areas, where thousands of people are gainfully employed. This has, in turn, attracted innovators and entrepreneurs chasing the main chances implicit in improving existing energy storage (battery) and smart-grid technologies. 

All of which raises a question: What does Texas know that New Brunswick doesn’t?

For years, we in The Purple Violet Province have known that we are home to enviably strong and steady coastal breezes. Back in 2007, a “wind energy map” of our environs conclusively proved that, with foresight and commitment, the resource was rich enough to support 5,000 megawatts of installed capacity. Currently, we have 500, which isn’t bad; but it’s still far below our potential. 

Last week, Liberal Leader Brian Gallant renewed his party’s commitment to installing a moratorium on further shale gas development in the province should he and his crew be lucky enough to form the next government in September. Citing public opprobrium and lingering doubts among various health experts, he wants more studies. Fair enough.

But a moratorium only delays the inevitable day of reckoning. It won’t convince those who adamantly oppose shale gas on principled (concern for planetary climate change) or practical (concern for local air, soil and water quality) grounds. 

It certainly won’t mollify the petroleum industry. It may buy Mr. Gallant a bit more time. Still, at what cost?

The clock is ticking in New Brunswick, where we have become absolute masters at telling private and public-sector authorities to pound sand whenever they have, on rare occasions, mustered the temerity to suggest that true economic development means taking chances. But if we are not prepared to risk what we cherish on shale gas, then what? What will we risk to build a better future for ourselves and our children?

The “aesthetes” of this province display an exasperating tendency to despise fossil fuel and wind power in equal measure. The former, they say, is smelly; the latter is ugly. These people revile change. They wonder why things can’t just go along they way they always have. This has produced, in government, a pathetic, if typical, response: ossification. Do nothing. Maybe, it will all work itself out, after all.

It won’t.

Texas knows this. Say what you like about that red-necked, killer-executing home of George “Wacko” Bush. 

At least, they do things big there.

 

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Mar 12 2014
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Energy, Environment, Idiocracy, Oil and Gas

The roiling tale of two imaginary pipelines

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In one hand, New Brunswick grips the key to its putative economic salvation; a pipeline spanning the better part of the second-largest landmass on the planet, from the oil fields and tar sands of Alberta right into little, old, plucky Saint John where the Irving refinery awaits, with bated breath, another profitable lease on life.

In the other, the picture-perfect province loosens it grip on everything its forebears allegedly designed (a healthy, self-sufficient, environmentally pristine part of the world) in the backwash of a curtailed and stolen future; a pipeline that would foul the ground, incinerate communities and spoil the water; a horrible industrial project that would return fleeting boons to short-term-thinking politicians, their confederates in commerce and not much else.

It’s odd how deliberately these opposing views manage to express themselves in New Brunswick’s print and broadcast media – as if never the twain shall meet, as if we, the sidelined majority, have nothing useful to lend to the debate over the province’s energy providence except, of course, our taxes and (sigh) our ears.

“Putative” and “alleged” are good words to describe the cases for and against a pipeline that does not, in fact, yet exist.

There are, of course, several ways to build a permanent way into a community. None of these, however, should have anything to do with terrorizing the citizenry or fictionalizing the landscape.

When Colleen Mitchell, president of Atlantica Centre for Energy, boosts on the front page of the Saint John Telegraph-Journal the benefits of an East Coast pipeline (without, I will note, a word of reasonable rebuttal), her kite flew so low, her hot air claimed its tail. She both terrorized the citizenry and fictionalized the landscape.

Here she is on her extraordinarily well-written rant:

“Five years (after the Great Recession of 2008) the gap between Atlantic Canada and the rest of Canada remains significant. . .The development of key oil and gas projects have the potential to reverse these economic trends. . .This project (TransCanada’s East Energy pipeline) is of such significance that if it proceeds to completion it will have a profound impact on the Atlantic region”

So profound, she says, it could amount to $35.3-billion in new gross domestic product across the country. So profound, she says, it could result in $266 million in new taxes to New Brunswick (during pipefitting) and maybe as much as $500 million after that. Moreover, she claimed with the sort of authority only an insider gets (and, trust me, she’s no insider), Irving Oil might just well spend upwards of $2 billion upgrading its coking and refining facilities in Saint John.

Oh, really?

This is irresponsible, unverified piffle; its feedstock derives directly from industry, itself. There is no way to credibly measure the merits of her assessments, just as there is no way to calibrate the real value of what she parrots are vast reserves of trapped shale gas in New Brunswick sedimentary rock. Why? Because industry, itself, is still reckoning the commercial viability of the resource. And, frankly, they’re not talking (which, in and of itself, should tell us something).

Still, she’s not the only partisan in the arena. Bid a welcome to the died-in-the-wool naysayers, who would rather buy their hemp oil from The Body Shop than see any of the dirty, necessary stuff that fuels their spectacularly energy-efficient homes spoil their golf-course-sized and well-fertilized lawns and gardens splendidly attended by certified “green” landscapers.

TransCanada Corp. has run afoul of four of nine National Energy Board regulations regarding its proper care and feeding of pipelines. This motivates New Brunswick Green Party honcho David Coon to theorize that “anything that suggests an increased risk of leaks will make everyone nervous.”

Furthermore, he postulates, “Since Stephen Harper has been prime minister, his orientation has been to ensure the National Energy Board is greasing the wheels of pipeline construction, not slowing it down because of things like safety and environmental impact.”

In other words, he seems to be saying, since the National Energy Board is, ipso facto, already compromised by the Conservative agenda, we must assume that its recent “harsh” judgement of TransCanada Corp. actually amounts  kid gloves’ treatment.

Again, so much for empirical evidence.

In one hand, the conspiracy theorists taketh away.

In the other, the apologists giveth back.

And, finally, no hands actually come together.

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Feb 20 2014
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Climate, Energy, Politics

Plotting some common ground for shale gas

Beyond the headland, off to meet the horizon

It is only my uncommon determination to discount the fruits of my fevered and hyperactive imagination that prevents me from earnestly entertaining my latest New Brunswick Economic Development Conspiracy Theory, version 2.0.

But for this mindful discipline, however, my theory might go a little like this:

At some point in the not-too-distant past, Progressive Conservative Premier David Alward sat down with Liberal Opposition Leader Brian Gallant in a dark, windowless room in the basement of one of New Brunswick’s seedier hotels. They had agreed to meet to hatch a plot, the outcome of which, then prayed, would be to their mutual advantage.

Each man knew that the shale gas controversy was not going away any time soon. Too much emotional capital had been spent for either opponents or their opposite numbers in industry to retreat from the front lines of lunacy. Too much empty rhetoric had been spilt for the sake of hearing one’s voice repeated ceaselessly on the nightly newscasts.

Yet, as political leaders, Messrs. Alward and Gallant recognized their respective responsibilities to take firm and preferably opposing positions on the issue.

The problem was that they also recognized, in each other, if not kindred spirits then at least a meeting of minds.

Though Mr. Alward argued publicly that shale gas was New Brunswick’s last, best hope for economic salvation, in his heart he worried about the environmental impact of an industry whose North American track record was, at best, spotty.

Conversely, though Mr. Gallant vigorously called for a moratorium on exploration and development until such time as two new studies shed better light on the subject, in his heart he worried about the province’s long-term economic future without the royalties and taxes a shale gas industry would generate.

The question, they reckoned, was how to have one’s cake and eat it too. Is it possible to satisfy both commercial and community interests without requiring unacceptably high sacrifices?

The related, if more urgent, question was how to take the mickey out of the public debate long enough to peaceably erect an industrial and regulatory apparatus acceptable to all but the most ardent green warriors (certainly all the Tories and Grits from here to the horizon)

And their stratagem?

That’s easy: Bore everyone to death, or at least until most people in the province would rather have their incisors pulled than stand to listen to a) one more meaningless, partisan diatribe about the dangers of hydraulic fracturing; and b) one more corporate shill expounding on the environmentally risk-free bounties from that friendliest of all fossil fuels.

Once the electorate is properly and finally focussed on other, more diverting  affairs like, say, the homophobic Winter Olympics 2014 (and not constantly expected to tender their proudly uniformed opinions, for or against shale gas) then, and only then, can the real, grown-up, bipartisan work of shaping a safe, regulated, productive, job-generating, income-producing, made-in-New Brunswick solution; the envy of the industrialized world.

Yup, it’s a nice theory and it does look good on paper. Too bad it’s bogus.

That constant whining sound emanating from Fredericton’s political class on the subject of shale gas is merely the all-too-familiar politics of disputation for the sake of disputation. No plan; nothing special. It’s politics as usual; that is to say, as usual Premier Alward blasts Mr. Gallant for standing soft on the issue and Mr. Gallant returns the favour by charging Mr. Alward with willful misrepresentation.

In fact, of the two, Mr. Gallant is more consistently correct and thoughtful with his criticism. But, at this point – where we seem to have come to a full stop, crumpled over by the burden of all our words – does it matter?

Where are our deeds? Where is our determination to forge practical alliances that span party and ideological lines to extract and sell our natural resources as safely and sustainably as possible?

While we’re at it, where is our courage to collectively face the essential energy paradox of our times – that we actually need the cleaner-burning fossil fuels to bridge us and our technologies to a greener more renewable future?

In the end, alas, politics upends even our finest conspiracies.

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Feb 07 2014
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Climate, Energy

How to defeat that dastardly coal

The world's ballooning use of coal guarantees that hot air will continue to rise

The world’s ballooning use of coal guarantees that hot air will continue to rise

To the extent that oil pipelines and drilling operations degrade the land, foul the water, spoil the air and otherwise compromise the environment all creatures big and tiny cohabit, people are right to worry and protest vigorously to their elected representatives when preventable infringements occur.

But the lunacy that now attends nearly every public debate about oil and gas – that these fossil fuels are somehow anthropomorphically evil, and that all who have truck with them are necessarily curtseying before killers – threatens to eclipse a far bigger and more concrete problem.

If we insist on making villains out of inanimate objects, we’d best start by recognizing that the real enemy of the global environment isn’t crude oil or shale gas or even Alberta bitumen; it’s coal. And, since the beginning of the century, use of this cheap, dirty energy source – the one that essentially powered the Industrial Revolution on two continents – has been rising, especially in emerging economic powerhouses, such as China and India, with vast populations to support.

According to the December 16, 2013, bulletin of the International Energy Agency (IEA) – a self-described “autonomous organisation which works to ensure reliable, affordable and clean energy” for its membership  – “tougher Chinese policies aimed at reducing dependency on coal will help restrain global coal demand growth over the next five years,” but coal will still “meet more of the increase in global primary energy than oil or gas, continuing a trend that has been in place for more than a decade.”

The IEA also predicts that while demand for coal in North America and Europe will flatten over the next five years – the result of tougher environmental regulations, among other factors – the effect will likely be temporary as the price differential between coal and oil will vastly favor the former. Moreover, “for the rest of Asia, coal demand is forecast to stay buoyant. India and countries in Southeast Asia are increasing consumption, and India will rival China as the top importer in the next five years.”

Indeed, observed IEA Executive Director Maria van der Hoeven, “like it or not, coal is here to stay for a long time to come. Coal is abundant and geopolitically secure, and coal-fired plants are easily integrated into existing power systems. With advantages like these, it is easy to see why coal demand continues to grow. But it is equally important to emphasize that coal in its current form is simply unsustainable.”

No kidding. NASA scientist James Hansen has called this black rock “the single greatest threat to civilization and all life on our planet.” That might be overstating the case just a bit, but there’s no denying the fact that coal-fired plants are atrocious polluters. The short list of toxic byproducts from your average burner might make you faint: mercury (a bonafide nerve poison), nitrogen oxide (which can turn your lungs into soup) and sulphur dioxide (which can, given enough time, stop your heart cold).

Then there’s cobalt, lead, arsenic, particulate matter. chromium, zinc, manganese, and radionuclides. And, let us not forget coal’s particular facility for producing greenhouse gases.

According to Greenpeace (which should have, by now, earned some mainstream  street cred), “coal fired power plants are the biggest source of man made CO2 emissions. This makes coal energy the single greatest threat facing our climate. . .Coal is the most polluting of all fossil fuels and the single largest source of global warming in the world. Currently one-third of all CO2 emissions comes from burning coal.”

And, don’t for a minute, get fooled by “clean-coal” claims of carbon, capture and storage technology. It doesn’t exist and probably won’t in any affordable manifestation for several years, even decades.

The inescapable fact is that burning fossil fuels (oil, gas and coal) is warming the planet. But not all such fuels are equal in their deleterious effects on the land, water and air we share with all living things.

Unless we are prepared to dismantle our societies, remove ourselves from our various grids, and find several million caves in which to dwell and from which to hunt beasties and gather berries, we’d better use the less harmful fuels at our disposal to wean ourselves from one that really will kill us sooner, rather than later.

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Jan 15 2014
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Energy, Environment, Oil and Gas

How Neil Young gets it right (and wrong) on oil

Oil is everywhere and everything?

Oil is everywhere and everything?

Fossil fuels make hypocrites of every environmental activist in the world.

The bright ones know that as consumers in the unavoidable petro-economy, they are just as culpable as anyone for climate change; but they push their planet-saving agenda anyway. After all, why remain silent on strategies for using oil and gas to transition to a cleaner, more sustainable future?

The dimmer ones, who never seem to suffer from a loss of words, prattle on about “us versus them” in apparent ignorance of the enormously complex socio-economic web this and other nations have spun with the products of refined dinosaur bones. Forget transforming the world; let’s just shut it down.

Thanks to celebrity big mouths and the media’s even bigger appetite for controversy, the question of the moment is: Into which camp does Canada’s legendary folk-rocker Neil Young fit? Is he a shining light or a broken bulb? A not entirely unrelated question is: Does it matter?

The Prime Minister Office seems to think it does. Why, otherwise, would it have dispatched its spokesman Jason MacDonald to defend Alberta’s curiously vulnerable tar sands against Mr. Young’s vituperative attack on them last Sunday night during the launch of a countrywide tour. At that time, the Grammy Award winner and Rock and Roll Hall of Famer said, using his outside voice:

“To me, it’s a basic matter of integrity on the part of Canada. Canada is trading integrity for money. That’s what’s happening under the current leadership in Canada, which is a very poor imitation of the George Bush administration in the United States. It’s lagging behind on the world stage and it’s an embarrassment to Canadians.”

To which, Mr. MacDonald responded: “Canada’s natural resources sector is and has always been a fundamental part of our country’s economy. . .The resource sector creates economic opportunities, and employs tens of thousands of Canadians in high wage jobs, contributing to a standard of living that is envied around the world, and helping to fund the programs and services Canadians rely on. . .Even the lifestyle of a rock star relies, to some degree, on the resources developed by thousands of hard-working Canadians every day.”

For Mr. Young, overall, so far so good. Whether or not you agree with his characterization of political leaders who are almost giddy at the prospect of selling their country – and First Nations communities in Alberta – down the river for a bag of bucks, you must, at least, acknowledge that he takes a principled stand.

More than this, perhaps, he is keenly aware of his stature, an effective weapon in the public relations battle to win friends and influence people (though methinks the man has already won enough hearts and minds for one life).

But, then, a funny thing happens on Mr. Young’s way to mainstream credibility regarding oil and gas. In his response to Mr. MacDonald’s jab about rock stars‘ reliance on natural resources, “Shaky” gets a little. . .well, shaky.

“Of course, rock stars don’t need oil. I drove my electric car from California to the tar sands and on to Washington DC without using any oil at all and I’m a rock star,” he says. “My car’s generator runs on biomass, one of several future fuels Canada should be developing for the Post Fossil Fuel Age. This age of renewable fuels could save our grandchildren from the ravages of Climate related disasters spawned by the Fossil Fuel Age; but we have to get started.”

He’s right. We do have to get started. But if, as he insists, rock stars don’t need oil, is he suggesting his life is a petroleum-free zone? For, if it is, that would be a neat trick, indeed.

According to one calculation from Ranken Energy Corp., “Americans consume petroleum products at a rate of three-and-a-half gallons of oil and more than 250 cubic feet of natural gas per day each.”

In fact, oil is in just about everything, from floor wax to bicycle tires to golf bags and purses. “Anything that’s not iron or steel or metal of some sort has some petrochemical component,” West Virginia University chemistry professor Dady Dadyburjor told The Associated Press not long ago.

This, one presumes, includes the chassis of Mr. Young’s electric car.

Of course rock stars need oil. We all do. And owning up to our collective addiction is the first step on the royal road to recovery from hypocrisy.

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Jan 09 2014
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Energy, Politics

Same old, tired chestnuts of office

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Tradition, if not prudence, demands that the premier of New Brunswick addresses the province’s electors at least once a year through the shrewd graces of the local, mainstream media.

So it was last week and this when David Alward presented himself to various editorial boards, his talking points in hand, his brow appropriately furrowed in keeping with the solemnity of the occasion.

New Brunswick, he said in so many words, was on the horns of a dilemma. Or, rather, perhaps it was at a crossroads, a critical juncture, a turning point. In any event, it needed a reality check, an infusion of entrepreneurial vigor, a shot in the arm.

These, naturally, are what one must endure when the sturdier veins of vision become varicose: cliches, all of them empty.

“We are still as focussed as we have ever been in terms of getting back to that fiscal strength where we need to be as a province,” Mr. Alward told the Telegraph-Journal. “We have taken and continue to take the difficult decisions, whether that be from an expenditure perspective – we see for the first time in many, many years a government actually come in under budget – the work on foundational reforms, whether that be on work on pensions or local government.”

It is, of course, authentically absurd to speak of coming in “under budget” in a province that’s running an annual budget deficit of $538 million for the current fiscal year and a long-term debt of $11 billion. Shall we now praise the provincial Tories for managing to keep most of their spending promises while the apparatus of the economy crumbles at their feet?

Yet, Mr. Alward also spoke of cornerstones: “Jobs and the economy continue to be the overriding issue that faces us collectively as a province, but as individuals and families as well. Continuing the work that we have done with the development of natural resources will be a very important part of that.”

Specifically, he said, “We are committed to seeing natural resource development as a key cornerstone. . .Next steps when it comes to shale gas development, next steps on things like the TransCanada pipeline, on a number of mining opportunities in the province, will all be very important.”

Does this seem yawningly familiar? Once upon a time in the Progressive Conservative liturgy, shale gas was but one “opportunity” the province might tap to lift the spirits of its flagging economy. Others included: commercially viable university research and development, health care innovation, software engineering, back office services, and data storage.

Now, the message coming from government circles is all about shale gas all the time, which would be just fine if there were anything new and constructive to contribute to the conversation. There isn’t.

The industry still doesn’t know if or when it will proceed to extract what remains, at best, an estimable asset. A vocal minority of New Brunswickers remain adamantly opposed to shale gas drilling. The rest of the population doesn’t seem to know or care enough about the issue to venture an opinion one way or the other.

And yet, this potential economic player somehow becomes a “cornerstone piece” in the puzzle that is New Brunswick 2014.

So does a pipeline from Alberta’s oil depots into Saint John. Forget the fact that political goodwill, while useful, does not a pipeline build without pubic support and regulatory approval.

These projects are not, in fact, projects until they begin to generate revenue for their commercial masters.

How, then, can government seriously view them as pillars of the provincial economy? A priori reasoning works marvelously well in philosophy – not so much in public planning.

Still, get ready one and all for another round of useless deficit targeting. Tradition  demands the February is the month for reckoning the condition of our collective pocketbook. And so, as usual, all the vain assumptions will be assembled. All the projections, masquerading as actual calculations, will be trotted out.

Mr. Alward, meanwhile, may wonder whether prudence, in the absence of anything novel or encouraging to say, now demands his silence.

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Dec 29 2013
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Business, Economy, Energy, Environment, Oil and Gas, Politics

2013: The year of treading water

U.S. economy may be heading for a hard, post-election landing

N.B. economy is heading for a repeat of 2013. . .only worse

New Brunswick enters the new year much as it did the outgoing one: Treading shark-infested waters, praying that the mighty predators will ignore it in favour of fatter, tastier castaways.

Under the grim circumstances, it’s a miracle that the government of David Alward was able to accomplish the little it did.

In 2013, population growth was at a standstill, general unemployment was among the worst in Canada (especially among what remains of the youthful labour force), the participation rate (those actively searching for work) was in a nose dive. About the only bright spot was low inflation and a relatively fixed consumer price index (measured in 2002 dollars).

Worse, perhaps, than any of this was the evident lack of new economic opportunities, without which the annual provincial deficit was fated to hover at $500 million on a structural, long-term debt of at least $11 billion in perpetuity. Theoretically, that meant that every New Brunswicker was on the hook for thousands of dollars.

The reality was that fewer public services were available to a dwindling number of people. And in the absence of any real vision for the future – any sense that timely sacrifices will ultimately yield durable boons – the province descended into caterwauling and complaining.

Some, of course, did their best to reverse the tide of bitterness and recrimination, while acknowledging the patently obvious.

“What we are facing in New Brunswick is a structural, secular decline,” former premier and current deputy chairman of T-D Bank Frank McKenna told me one wintery afternoon in his downtown Toronto office. “The problems we have don’t ebb and flow with the quality of our leadership. There is something more serious going on here. We face circumstances that combine to create a very negative outlook. The entire atmosphere is hugely challenging.”

In fact, he said, “the resource base that remains can be exploited with fewer workers and more mechanization, so it can’t support the number of workers that it once did. Yet, we remain a resource-based economy in a world where the Canadian dollar looks to be in a fairly constant state of parity with the U.S. dollar. So, this, too, is a peril.”

And yet, he said, “Even though I think our situation in New Brunswick is quite pessimistic, I don’t think that it is terminal. There are many places in the world that have faced dramatic challenges. In fact, adversity, itself, became the platform upon which they built sustainable economies. . . This isn’t just a problem of leadership in government. It’s also a problem of followership.

“Our citizens have to understand the full depth and breadth of the dilemma that we are facing, and they have to be prepared to face up to some inconvenient truths. It means that they have to become less reliant on government and more entrepreneurial. It means that they have to take responsibility for their own futures.”

For Mr. McKenna and, indeed, Mr. Alward, taking responsibility for the future means brining Alberta oil east for refining in Saint John – which would create thousands of construction jobs – and developing the province’s nascent shale gas industry.

“The way I look at it,” Mr. McKenna said, “the real win comes when we take our indigenous shale gas in the province and hook it into the Canaport liquified natural gas (LNG) facility in Saint John.”

His voice rose as his enthusiasm peaked. “We have in situ now, calculated by Corridor Resources Inc., 67 trillion cubic feet of gas. That’s bigger than western Canada. It’s a huge deposit. If ten per cent is exploitable, that’s enough to create a revenue source for New Brunswick for decades to come. All in, it would result in about $15-20 billion in investment and 150,000 person years of work. And for governments, it would result in between $7-9 billion worth of royalties and taxes.”

By and large, however, these were mere musings of a former public official. They did little to quell the outrage of a vocal minority of residents – people who firmly believed the provincial government had no business encouraging the development of an industry that they said would poison them.

Would it poison them? Was there, instead, a safe, environmentally responsible approach to the whole affair?

The issue will carry forward into 2014 and, like just about every other issue in New Brunswick, remain there unresolved, as the sharks keep circling.

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Dec 17 2013
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Business, Economy, Energy, Environment, Oil and Gas, Politics

The political art of fomenting depression

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What’s perplexing about the David Alward government’s decision to spend a few thousand taxpayer bucks on TV ads showing New Brunswickers mourning the state of their province’s economy is not that it reflects poorly on our lawmakers’ vision of the future.

What’s perplexing is that our lawmakers seem to believe it reflects well on their own political fortunes.

Less than a year before the general election, the Tories are bringing up the rear in popular opinion. Poll after poll suggests that if the ballot were held today, they’d lose to Brian Gallant’s Liberals by a wide margin.

This somehow impels the big brains who occupy the small offices reserved for government communications to remind New Brunswickers in convincing fashion, and just before the holidays, that the past three-plus years in office have been an unmitigated disaster for the Progressive Conservatives.

The ads show various men and women, who are presumably en route to the oil-black and money-green pastures of western Canada, hanging out on tarmacks and in airport departure lounges, their brows appropriately furrowed.

“I’ve been going for four years,” says one.

“We haven’t got enough opportunities here, we have to go do it out west,” says another.

Finally, up pops the kicker, accompanied by a stern-sounding VoiceOver: “This message is brought to you by the Government of New Brunswick.”

Now, we witness the game, if untried, Mr. Gallant mumbling under his breath and, indeed, over it: “Thank you, Mr. Alward, you just made my day.”

Of course, in the local media, he sounds more like this:

“New Brunswickers don’t need an ad to tell them that there aren’t enough jobs in New Brunswick. This is an ad that is virtually discouraging people to stay and invest in New Brunswick. It’s even demoralizing.”

To which, Premier Alward retorts, “Every day there are families that are living with separation and we believe there are good options long term to see our economy be stronger, our province be stronger, and our people be able to decide to be here and build their communities here. . .It’s a message to all New Brunswickers that we need to be saying yes to allow development to take place.”

Well. . .no, actually.

It is a message to all New Brunswickers that they are at death’s doorstep, and that their only salvation is via the kool aid of shale gas development, which may or not be true. (It’s too early to know anything with certainty).

What I do know, from my years in the marketing communications and advertising industry (I call them my “lucrative” epoch), is that scaring the bejesus out of people is guaranteed to produce only one, durable response: shoot the messenger.

Again, Mr. Alward, Mr. Gallant thanks you.

What’s intriguing about all of this is just how unnecessary it is.

The Alward government holds all the cards in the shale gas industry deck. Its regulations for development are, purportedly, the toughest in North America. It has the benefit of knowing all the best and worst practices. It even has a scientific panel, convened to guide its decisions (though only The Almighty knows when this efficacious advice will be forthcoming).

What’s more, its foes on this file are, though vocal, largely in the minority.

If it truly wants to win the hearts and minds of the majority, why doesn’t it produce ads that speak directly to the issue – spots that fight the fictions swirling around shale gas with facts?

Why not emphasize the positive attributes of an industry that, properly regulated, could help transform the province’s economy – thanks to the money it will generate for public coffers – into an incubator of commercially viable innovations in sectors not specifically related to resource extraction?

Those who argue that the provincial government has no business using public dollars to promote its economic agenda are, among other things, on the wrong side of history. Governments do this sort of thing all the time. In fact, we expect it of them, especially when they don’t do it. What is tourism, except a giant public-sector promotion campaign?

This Tory reign has staked its mandate on transforming the New Brunswick economy through its responsible stewardship of natural resources. Its most recent ad campaign, however, indicates that it has not yet learned how best communicate this otherwise clear and simple message.

Meanwhile, as goes its mandate, so goes any chance New Brunswick has of seizing its future for its now-departing citizens.

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