‘Still a need for certainty’: Analyst on the push for Canada as an energy superpower

An aerial view of Alberta's oilsands. Oil and gas extraction jumped in October before declining in November.

This year’s global energy show begins with a three-day conference in Calgary with a considerable focus on Canada pushing itself as an energy superpower. Evan Bahry of Energy Connections Canada joins Alberta Primetime’s Michael Higgins to discuss this and a possible new pipeline for Alberta.

This interview has been edited for clarity and length.

Michael Higgins: How much of a barometer do you expect this year’s global energy show to be where the direction of your industry is concerned?

Evan Bahry: We’re very interested in seeing and hearing Minister Hodgson speak so strongly about renewing Canada’s energy sector, with the prospect of regulatory reform, seeing new investments, and also seeing how well provinces and industries have responded to the federal government’s new tone. By that, we’re hearing interest from various provinces – New Brunswick, Nova Scotia and British Columbia – exporting and developing their resources, and industry responding to not only global energy prices but the important new tone from the federal government to indicating interest in developing and seeing this industry grow.

MH: How much weight do you see federal and provincial commitment to the pipeline MOU (memorandum of understanding) carrying with this particular crowd? How far does that go in driving investment confidence?

EB: It’s needed, that’s for sure. It reflects an important pivot from the direction we’ve seen in previous years, where there really was no certainty or understanding of the government’s interest in advancing this industry. That’s now been reversed by the commitments, the promises, the MOUs, and the actions being addressed by the federal government to really take and seize the important opportunity before them.

We have countries from around the planet coming to Canada seeking to procure our energy, it’s our number one export. Recently, decisions by Shell to invest or Germany Utility to purchase off-take arrangements for LNG, are all incredibly good news and are reflective of those commitments by the Government of Canada. We’re seeing a new pivot, a new era of opportunity for the business being led by the federal government’s new commitments to change and reform.

MH: What about commitments where we’re growing production? There are certainly signs of high oil prices sticking around for some time. Does all of this play into production as well?

EB: I think you make a good point that we’re seeing a lot of interest in gas consumption, from the form of LNG. We’re looking to see how the producers of oil are responding, like oil sands or conventional oil, to not only the current oil price environment but also what the federal government’s interests are for oil pipelines.

I think there still is a need for more certainty and changes to more legislation that the federal government introduced over the last decade to really cement that sense of investor confidence in the business, but the price signal is clearly there. What needs to be understood is the oil pipeline development and the certainty in policy reform that the government has promised.

MH: You wrote a column in the Calgary Herald, calling on the powers to “seize the day, answer the world’s call for energy.” What kind of radar are you currently getting on that renewed world interest in Alberta’s energy sector as a destination for investment?

EB: The global interest is clear given by the decision by German Utility to procure offtake LNG volumes as well as others rumoured to look into LNG, but in terms of concrete steps, we’re also encouraged by the government’s decision a few weeks ago to consult upon regulatory reform in Canada. To create the idea of one project, one decision for Canadian pipelines.

That is an important, significant commitment by the Government of Canada that we are responding to with comments and encouraging suggestions to refine those ideas. This represents an important change of direction for Canada’s energy industry, not only in terms of what the federal government’s committing, but also how industry has responded. We’re very optimistic that we’re heading in the right direction.

MH: What will your industry need to hear from politicians like the premier and the federal energy minister, to maybe help mitigate any investment concerns over dominant dialog around the issue of separation?

EB: We’re still looking for concrete changes to legislation that have been telegraphed. For example, legislation around pipeline regulation, changes to the green washing legislation, changes to the tanker ban that are still on the books. Those are all committed to have been worked away, but looking for legislation that has been burdensome, impactful to the industry, detrimental to the industry, to be to be removed formally.

The commitments have been made to improve the investment climate in Canada, that is something that the industry is very receptive to hearing. We’re looking forward to capitalizing on the profound potential of Canada’s oil and gas reserves. You have to keep in mind we have this profound resource of some 170 billion barrels of oil and 1,300 trillion cubic feet of natural gas in our country. The world is looking for stable and responsible providers of that energy. We have a need in this country to find proven winners as an economy that is challenged under tariffs, so the opportunity that we have right now is really a golden one that industry is looking forward to capitalizing upon.