DOCSLIB.ORG

Sustaining the Crude Economy Future Prospects for Canada’S Global Energy Competitiveness

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Sustaining the Crude Economy Future Prospects for Canada’S Global Energy Competitiveness Sustaining the Crude Economy Future prospects for Canada’s global energy competitiveness By Laura Dawson and Stefania Bartucci OCTOBER 2012 45 40 35 30 25 20 15 10 5 0 2005 2010 2015 2020 2025 A Macdonald-Laurier Institute Publication Laura Dawson and Stefania Bartucci – October 2012 1 True North in Canadian Public Policy Board of Directors Advisory Council CHAIR Purdy Crawford Rob Wildeboer Former CEO, Imasco, Counsel at Osler Hoskins Chairman, Martinrea International Inc., Toronto Jim Dinning Former Treasurer of Alberta MANAGING DIRECTOR Brian Lee Crowley Don Drummond Former Clifford Clark Visiting Economist Economics Advisor to the TD Bank, Matthews Fellow in at Finance Canada Global Policy and Distinguished Visiting Scholar at the School of Policy Studies at Queen’s University SECRETARY Brian Flemming Lincoln Caylor International lawyer, writer and policy advisor Partner, Bennett Jones, Toronto Robert Fulford Former editor of Saturday Night magazine, columnist TREASURER with the National Post, Toronto Martin MacKinnon CFO, Black Bull Resources Inc., Halifax Calvin Helin Aboriginal author and entrepreneur, Vancouver DIRECTORS Hon. Jim Peterson John Beck Former federal cabinet minister, Partner at Chairman and CEO, Aecon Construction Ltd., Fasken Martineau, Toronto Toronto Maurice B. Tobin Erin Chutter The Tobin Foundation, Washington DC President and CEO, Puget Ventures Inc., Vancouver Navjeet (Bob) Dhillon Research Advisory Board CEO, Mainstreet Equity Corp., Calgary Janet Ajzenstat Keith Gillam Professor Emeritus of Politics, McMaster University Former CEO of VanBot Construction Ltd., Toronto Brian Ferguson Wayne Gudbranson Professor, health care economics, University of Guelph CEO, Branham Group, Ottawa Jack Granatstein Stanley Hartt Historian and former head of the Canadian Chair, Macquarie Capital Markets Canada War Museum Les Kom Patrick James BMO Nesbitt Burns, Ottawa Professor, University of Southern California Peter John Nicholson Rainer Knopff Former President, Canadian Council of Academies, Professor of Politics, University of Calgary Ottawa Larry Martin Rick Peterson George Morris Centre, University of Guelph President, Peterson Capital, Vancouver Christopher Sands Jacquelyn Thayer Scott Senior Fellow, Hudson Institute, Washington DC Past President, Professor, Cape Breton University, William Watson Sydney Associate Professor of Economics, McGill University For more information visit: www.MacdonaldLaurier.ca Table of Contents Executive Summary ........................................ 2 Shortage of Skilled Labour ..................................19 Trade and Investment Rules ...............................20 Sommaire exécutif ..........................................4 Trade Related Environmental Measures ........21 Canada’s Energy Endowment .........................6 Investment ......................................................23 Backdrop to a Canadian Energy Strategy ..............6 Royalties and Provincial Cooperation Whither a Canadian strategy? ................................8 in Energy .............................................................23 Canada’s Role in Global Markets and the Need Conclusion ....................................................24 for Diversification ...........................................9 Appendix 1: The Economics of Petroleum Global Demand ...................................................10 Upgrading and Refining in Canada ...............26 International Competition ..................................11 Upgrading Bitumen ......................................226 Canada’s Competitiveness Challenges.......... 12 Economic Rationale .......................................27 Distribution and Infrastructure...........................12 Appendix 2: Budget 2012 and the Shift Pipelines and Alternatives ..............................12 Towards “One Project, One Review” ............ 27 Refining Infrastructure ...................................14 About the Authors .........................................28 Regulatory Challenges.........................................16 Uneven or Inadequate Aboriginal Consultation ...18 Endnotes ....................................................... 29 The authors of this document have worked independently and are solely responsible for the views presented here. The opinions are not necessarily those of the Macdonald-Laurier Institute, its Directors or Supporters. Executive Summary anada is a nation rich in energy resourc- there is an insatiable global demand. What stands es. Oil, natural gas, hydro, uranium, coal, in the way of Canada’s ability to take advantage of C wind – Canada has abundant supplies of this economic windfall? There are a number of ac- renewable and non-renewable resources. Our 173 tions Canada must take today in order to position billion barrels of proven oil reserves place us third itself for competitiveness in the global oil and gas globally, behind Saudi Arabia and Venezuela, and sector tomorrow. we are the only non-OPEC member in the top five. Canada is the largest foreign supplier of oil to the United States and we are the world’s third largest natural gas producer and exporter. Canada must take action today to But the game is changing: shrinking US demand be positioned for competitiveness for imports, inability to service Asian markets, dis- tomorrow. tribution bottlenecks, inefficient regulatory pro- cesses, and labour shortages are hurting Canadian competitiveness. Although the hydroelectric and renewables sectors have challenges in their own Distribution is the top priority so that Canadian right, none has earned the public and political at- energy products can get to new markets more effi- tention given to the oil and gas sector, as stake- ciently. Perhaps the greatest frustration for Canadi- holders work to create a competitive and sustain- an producers is the lack of access to the tidal water able industry for the 21st century. in order to reach fast growing Asian markets. The long-term shift in demand towards Asian mar- Finding environmentally responsible and efficient kets means that the US will account for a diminish- ways to transport energy products is a lynchpin ing share of Canadian exports, replaced by emerg- of our future success as a global energy leader. As ing market customers, China first among them. On well, although improving access to refineries on the face of it, Canada is in an enviable position: it the US Gulf Coast and possibly eastern Canada has a rich endowment of commodities for which makes more economic sense than building new ca- 2 Sustaining the Crude Economy: Future Prospects for Canada’s Global Energy Competitiveness pacity in Canada, it is important for governments, nities, and provide them with the training needed industry, and the public to carefully consider the to participate in the energy sector workforce. full spectrum of costs and benefits of establishing a more self-sufficient national energy sector. Externally, our formal trade and investment agree- ments must reflect the priorities of national energy Regulatory inefficiency is a major impediment to competitiveness and create a level playing field investment and growth. The costs and uncertain in order for Canada’s industry to grow in global timelines associated with the review process pose markets. significant risks to project proponents, which can cause them to reconsider their plans to proceed Does Canada need a comprehensive national ener- with a project, or not to invest at all. At the same gy strategy? The notion of a Canadian Energy Strat- time, the government has a mandate to protect egy (CES) has preoccupied media commentary for the public interest, and ensure that the social and much of 2012. We argue that the answer is no. The environmental externalities of major projects are energy sector across Canada is so diverse that prog- properly addressed. This is complicated by the fact ress in any one subsector would be very difficult, that major energy projects fall within areas of both with provincial premiers competing to promote federal and provincial jurisdiction, requiring ap- their regional interests. The Council of the Fed- provals from several government departments and eration is a well-established mechanism to foster agencies touching on issues ranging from environ- and promote interprovincial dialogue. Reinventing mental safety to public interest to Aboriginal rights this in a separate sphere would serve no purpose. and land and water use. Moreover, Canada’s comprehensive consultative mechanism allows many opportunities for input from business and civil society stakeholders. To be sure, existing policies and programs are not Distribution is the top priority for complete. More can be done to address environ- improving energy in Canada. mental, regulatory, labour, and distribution chal- lenges. However, existing mechanisms and institu- tions have the capacity and authority to deal with Continued streamlining of the regulatory process the competitive challenges facing Canada in all goes hand in hand with the expansion of distribu- areas but one. It is clear that provincial disputes tion capacity. However, progress depends on an over allocation of resource revenues are going to approach by business and government that balanc- continue to flare up as the sector grows, and as es economic efficiencies with environmental sus- infrastructure and risk cross provincial boundar- tainability and Aboriginal rights. The government’s ies. The existing system of equalization payments recent reform of the regulatory process may very
Load more

Recommended publications
  • 2016 Annual Report
    2016 Annual Report CCAB – Annual Report 2016 2 Vision Growing a diverse and prosperous Aboriginal business community. Core Values • Respect for all Aboriginal cultures • High standards of ethics and integrity • Open, honest, and transparent relationships with all stakeholders. Mission To foster sustainable business relations between Aboriginal and non-Aboriginal business. CCAB – Annual Report 2016 3 TABLE OF CONTENTS About CCAB ................................................................... 4 Aboriginal Hall of Fame National Youth Aboriginal Entrepreneur Award ................................................. 26 Message from the Co-Chairs ......................................... 5 Award for Excellence in Aboriginal Relations .......... 27 Message from the President and CEO .......................... 6 Aboriginal Economic Development 2016 Events and Sponsorship ........................................ 7 Corporation (AEDC) Award ..................................... 28 18th Annual Toronto Gala ........................................... 8 Research ....................................................................... 29 Toronto Hot Topic Series ........................................... 9 Opportunities and Challenges ................................ 30 Annual Calgary Gala ................................................ 10 Communications and Public Relations ......................... 31 Montreal Keynote and Networking Reception ........ 11 President and CEO – 2016 Speaking Engagements ..........................................................
    [Show full text]
  • CANADA All About Oil and Gas*
    ALBERTA OIL & GAS INDUSTRY Q UA R T E R LY UPDATE FALL 2014 Reporting on the period: June 15, 2014 to Sept. 30, 2014 ALBERTA CANADA All about oil and gas* Technological advancement has set the horizontal wells and multistage fracturing 1.8 billion barrels, representing about stage for another boom in Alberta’s non–oil in tight oil plays across the province—not to one-third of Canada’s remaining conven- sands oil and natural gas industry. Until mention new provincial royalty incentives tional reserves. This is a year-over-year the last few years, the sun had slowly been to encourage drilling—has crude oil drilling increase from 2012 of five per cent, setting on Alberta’s conventional oil and activity and production on the upswing. resulting from all reserve adjustments natural gas industry. Oil production had less production in 2013. declined from a peak of 1.43 million barrels In fact, the tight oil revolution that began Alberta’s production of conventional crude per day in 1973 to a low of around 460,000 in the United States and gradually moved oil totalled 213 million barrels in 2013, an barrels per day in 2010. north into Alberta marks the dawning of a new day for oil and natural gas exploration increase of five per cent. But things are changing for the better, and production in the province. as increased implementation of long The province is also the largest contributor to In Alberta, the new technology is being Canadian oil and equivalent production and used in an increasing number of oil plays.
    [Show full text]
  • 2Nd Half FARA Report to Congress Ending
    U.S. Department of Justice . Washington, D.C. 20530 Report of the Attorney General to the Congress of the United States on the Administration of the . Foreign Agents Registration Act . of 1938, as amended, for the six months ending December 31, 2008 Report of the Attorney General to the Congress of the United States on the Administration of the Foreign Agents Registration Act of 1938, as amended, for the six months ending December 31, 2008 TABLE OF CONTENTS INTRODUCTION ................................................... 1-1 AFGHANISTAN......................................................1 ALGERIA..........................................................2 ANGOLA...........................................................3 ARUBA............................................................5 AUSTRALIA........................................................6 AUSTRIA..........................................................7 AZERBAIJAN.......................................................8 BAHAMAS..........................................................10 BAHRAIN..........................................................11 BARBADOS.........................................................12 BELGIUM..........................................................13 BELIZE...........................................................14 BERMUDA..........................................................15 BOLIVIA..........................................................16 BOSNIA-HERZEGOVINA...............................................17 BRAZIL...........................................................18
    [Show full text]
  • Shen, Wendy 319577 ENVR690 Y1112P-01
    Running head: SOCIAL MEDIA PERSUASION: THE KXL PIPELINE DEBATE 1 SOCIAL MEDIA PERSUASION: THE KXL PIPELINE DEBATE By WENDY YVONNE SHEN Hon B.Sc., University of Toronto, 2008 A thesis submitted for the partial fulfilment of the requirements for the degree of MASTER OF ARTS in ENVIRONMENT AND MANAGEMENT ………………………………………………. Dr. Richard Kool, Thesis Supervisor School of Environment and Sustainability Royal Road University ………………………………………………. Dr. Christopher Ling, Director School of Environment and Sustainability Royal Road University ………………………………………………. Dr. Matthew Heinz, Dean Faculty of Social and Applied Sciences Royal Road University ROYAL ROADS UNIVERSITY July 2015 © Wendy Yvonne Shen, 2015 SOCIAL MEDIA PERSUASION: THE KXL PIPELINE DEBATE 2 Abstract The Keystone XL pipeline project has been debated and reviewed by both Canadian and U.S. governments for many years, and as of the writing of this thesis (2015) the U.S. government has still not approved the permit to begin the construction of the Keystone XL (KXL) pipeline project. As a result, supporters and opponents continue to try different ways of persuading and engaging the public. More and more organizations are turning to social media as a tool to inform, promote and persuade. This thesis examined how Cialdini’s persuasion principles along with Kietzmann et al.’s honeycomb social media framework were used to frame KXL website material, Facebook posts and Twitter tweets for 16 key players which included industry, associations, ENGOs and government agencies during protests, environmental disasters and policy-announcements. I found that the ENGOs used all or most of Cialdini’s persuasion principles to frame their opposition views, which translated into high social media engagement.
    [Show full text]
  • Where Power Comes to Matter: the Energy East Pipeline and the Politics of Determinacy
    Where Power Comes to Matter: The Energy East Pipeline and the Politics of Determinacy Élie Jalbert A Thesis in The Department of Sociology and Anthropology Presented in Partial Fulfillment of the Requirements for the Degree of Master of Arts (Anthropology) at Concordia University Montreal, Quebec, Canada August 2018 © Élie Jalbert 2018 CONCORDIA UNIVERSITY School of Graduate Studies This is to certify that the thesis prepared By: Élie Jalbert Entitled: Where Power Comes to Matter: The Energy East Pipeline and the Politics of Determinacy and submitted in partial fulfillment of the requirements for the degree of Masters of Arts (Anthropology) complies with the regulations of the University and meets the accepted standards with respect to originality and quality. Signed by the final examining committee: ______________________________________ Chair ______________________________________Christine Jourdan Examiner Bart Simon ______________________________________ Examiner Jean-Philippe Warren ______________________________________ Thesis Supervisor(s) Kregg Hetherington _______________________________________ Approved by ____________________________________________________ Chair of Department or Graduate Program Director Dean, Date ________________________________________________ Abstract Where Power Comes to Matter: The Energy East Pipeline and the Politics of Determinacy Élie Jalbert Concordia University, 2018 This thesis is about the controversies that engulfed TransCanada's Energy East pipeline project from the moment it emerged into the public sphere in 2013, and which led to its ultimate demise in 2017. As such, it is an investigation into how power, sovereignty, and agency were mobilized in the negotiation of a pipeline project in Canada. In the contemporary political and environmental climate, pipeline projects have had a rough go of it. Sweeping changes made to the legislative and regulatory framework by the Conservative federal government in 2012 were intended to expedite their approval but appear to have had a contrary effect.
    [Show full text]
  • Should Companies Invest in Sustainability?
    Short Communication Civil Eng Res J Volume 7 - Issue 4 - March 2019 DOI: 10.19080/CERJ.2019.07.555717 Copyright © All rights are reserved by Yossi Sheffi Should Companies Invest in Sustainability? Yossi Sheffi* MIT Center for Transportation and Logistics, USA Submission: February 23, 2019; Published: March 15, 2019 *Corresponding author: Yossi Sheffi, MIT Center for Transportation and Logistics, USA Short Communication Three of the most revealing results of the research that led In April 2018, MIT Press published my book, Balancing to my book are that Green: When to Embrace Sustainability in Business (and When Not To). The book was a result of five years of primary research A. Companies cannot control most of their emissions even interviewing hundreds of executives in industry, government if they wanted to and NGOs. My original intent was to argue, as did others, that B. Most consumers are not willing either to pay more or business should take the lead because many governments are incur slight inconveniences in the name of sustainability, and paralyzed by discord and political calculus. Industry, I thought, being the source of most environmental impacts, can and should C. Jobs and economic development are more important lead the way (Figure 1). than sustainability. 1. It’s Outside the Four Walls For almost every company, most of its environmental footprint of a company’s products is not in its own operations. Instead, it comes from either its upstream supply chain (the deep-tiered network of suppliers, sub-suppliers, sub-sub-suppliers, and so on) or from downstream in the use phase (when consumers use and discard the product).
    [Show full text]
  • Oil and Gas News Briefs, January 26, 2017
    Oil and Gas News Briefs Compiled by Larry Persily January 26, 2017 Floating LNG import terminals open up new markets (Financial Times; London; Jan. 23) - A rapid increase in liquefied natural gas supplies is threatening to flood the market for at least the next three years, forcing producers and traders to find more nimble ways to place cargoes into global trade. The looming glut is focusing attention on whether existing customers stretching from Asia to the U.K. will benefit from lower prices and whether LNG can increase its market share by utilizing a growing fleet of ships that can deliver directly into power plants and pipeline networks. These floating storage and regasification units (FSRUs) have become the key to opening up new markets for LNG over the past five years, allowing deliveries into countries like Egypt and Argentina without the need for costly new onshore import terminals. Over the next two years or so the number of operating FSRUs is set to grow by about 40 percent to almost three dozen worldwide, potentially opening up new markets and helping LNG move one step closer to becoming truly global. “The overwhelming majority of new markets in recent years have been FSRU markets,” said Hadi Hallouche, head of LNG trading at commodity house Trafigura. “The coming oversupply will only accelerate this trend.” LNG supplies are forecast to increase by as much as 50 percent between 2015 and 2020, with the U.S., Australia and Russia adding significant export capacity. While the main LNG demand centers like Japan and China still rely on onshore terminals, which generally take years to build at a cost of billions of dollars, the tie-ups and links for an FSRU often can be put in place in a matter of months.
    [Show full text]
  • FARA First Semi-Annual Report
    U.S. Department of Justice . Washington, D.C. 20530 Report of the Attorney General to the Congress of the United States on the Administration of the . Foreign Agents Registration Act . of 1938, as amended, for the six months ending June 30, 2009 Report of the Attorney General to the Congress of the United States on the Administration of the Foreign Agents Registration Act of 1938, as amended, for the six months ending June 30, 2009 TABLE OF CONTENTS INTRODUCTION ................................................... 1-1 AFGHANISTAN......................................................1 ALBANIA..........................................................2 ALGERIA..........................................................3 ANGOLA...........................................................4 ARGENTINA........................................................6 ARUBA............................................................7 AUSTRALIA........................................................8 AUSTRIA..........................................................10 AZERBAIJAN.......................................................11 BAHAMAS..........................................................13 BAHRAIN..........................................................14 BARBADOS.........................................................15 BELARUS..........................................................16 BELGIUM..........................................................17 BELIZE...........................................................18 BERMUDA..........................................................19
    [Show full text]
  • Canada's Skills Crisis: What We Heard
    Canada’s Skills Crisis: What We Heard A Canadian Chamber of Commerce report on cross-country consultations in 2012 Updated Sept. 27, 2012 This report was made possible by the generous support of our sponsors Diamond Platinum Gold ADP Canada Deloitte & Touche LLP Teck UOIT (University of Ontario Institute of Technology) This report was made possible by the Table of Contents generous support of our sponsors President’s Message ........................................................................................................................ 3 Consultation process ..................................................................................................................... 9 Alberta .............................................................................................................................................. 10 Prairies – Manitoba and Saskatchewan ....................................................................................... 17 British Columbia ............................................................................................................................. 22 Ontario – Golden Horseshoe ......................................................................................................... 24 Quebec .............................................................................................................................................. 28 Atlantic Canada ............................................................................................................................... 31 Canada’s
    [Show full text]
  • Sector Profile
    Calgary Alberta EnergyCanada Sector Profile Energy Sector Profile 2012 1 Table of Contents Calgary has a great energy and a great story 7 Unconventional energy 22 An economy poised for growth 8 Shale gas 23 Tight oil 23 Competitiveness 8 Oil sands 23 Human energy 9 Oil sands recovery and extraction 23 Financial energy 10 Oil sands and the environment 23 Calgary; a safe and secure destination 13 for foreign investment Electricity 24 Leading the industry with 14 Energy industry services 25 Sustainable and renewable energy Sustainable and renewable energy 26 Oil Sands Leadership Initiative 15 Wind Energy 28 Canada’s Oil Sands Innovation Alliance 15 Solar Energy 28 Alberta Energy Efficiency Alliance 15 Renewable fuels 29 Alberta is Energy 15 The role of Calgary Economic Development 30 Alberta’s energy strength 16 What we can do for your business 31 Conventional energy 18 Trade missions 31 Incoming missions 32 Conventional oil 19 Sustainable and Renewable Energy Cluster (SURE) 32 Natural gas 19 World Energy Cities Partnership and Calgary 32 Pipelines 19 Climate Change Accord Chemical manufacturing and petrochemicals 20 Fuel Forward 32 Coal 20 Appendix: Calgary’s energy companies 33 Action Calgary corporate partners 35 Contact Information 36 2 Energy Sector Profile 2012 There’s an energy in Calgary that exhilarates, invigorates & motivates. It’s a place of big skies & big ideas. Calgary is an economic force and our western values run and a catalyst for today’s deep. Calgary is a diverse city trailblazers. There’s an intense, that embraces change and urban vitality in Calgary that change-makers, and supports unleashes the bold, and sustains its communities can-do spirit of entrepreneurs and its people.
    [Show full text]
  • Now That's a Bad
    DIPLOMATIC NEWCOMER: LATEST GAC ORG CHART, YOUR GUIDE TO UNDERSTANDING HILL MEDIA PP. 13-18 HILL CLIMBERS p. 19 GWYNNE DYER p. 9 SCOTT TAYLOR p. 9 CHANTAL HÉBERT p. 11 TIM POWERS p. 11 LES WHITTINGTON p. 10 Ambrose Parsing Korean Getting rid of Tories can learn Peter MacKay: Trump victory would hires two rhetoric and Daesh will not from PQ’s sometimes it is harder threaten Canada’s staffers reality end the conflict charter bungle to say no than yes entire economy TWENTY-SEVENTH YEAR, NO. 1369 CANADA’S POLITICS AND GOVERNMENT NEWSPAPER WEDNESDAY, SEPTEMBER 14, 2016 $5.00 NEWS CONSERVATIVE LEADERSHIP RACE Now that’s a bad day: Poll finds Liberals with ‘huge brand equity’ in Atlantic as MacKay rules Construction truck impaled out Tory leadership bid BY TIM NAUMETZ which voted Liberals into all 32 by security barrier on Hill House of Commons seats in the A new poll has found Justin region last October, are satis- Trudeau’s Liberal government at fied with the performance of the historic highs in Atlantic Canada, federal government, a quarterly throwing cold water on the fed- survey by Corporate Research eral Conservatives during their Associates of Halifax suggests. foray into Halifax this week in It breaks down to 63 per cent of an attempt to begin rebuilding respondents who were mostly support following the party’s 2015 satisfied and 11 per cent who election defeat in the region. were completely satisfied. Fully 74 per cent of elec- tors in the Atlantic provinces, Continued on page 6 NEWS TRADE U.S.
    [Show full text]
  • Assessing the Economic Potential of Edmonton City Centre Airport
    Assessing the Economic Potential of Edmonton City Centre Airport Prepared for: June 2009 Peter Morris Andrew Charlton Jake Reppert TABLE OF CONTENTS 1 INTRODUCTION............................................................................................2 2 STRUCTURE OF THE REPORT ........................................................................6 2.1 KEY ISSUES .............................................................................................................. 6 3 THE IMPORTANCE OF BUSINESS AIRPORTS ................................................7 3.1 WORLDWIDE DATA .................................................................................................... 8 3.1.1 AIRPORTS COUNCIL INTERNATIONAL................................................................................. 8 3.1.2 EUROCONTROL AIRPORT STUDY 2007 ............................................................................ 10 3.1.3 US FEDERAL AVIATION ADMINISTRATION ........................................................................ 12 3.1.4 THE NATURE OF BUSINESS AVIATION- INFORMATION FROM NBAA IN USA .............................. 13 3.1.5 THE EUROPEAN BUSINESS AVIATION ASSOCIATION ............................................................ 13 3.1.6 STATISTICS CANADA ................................................................................................... 14 3.2 THE VALUE OF ECCA - INTERVISTAS’ 2005 REPORT................................................... 17 4 AN ANALYSIS OF EDMONTON’S AIRPORTS’ TRAFFIC.................................20
    [Show full text]