Canadian Fossils Try Pivot to Light Oil, Natural Gas
Light oil and natural gas development may be the next big thing for Canadian fossils “looking to step out of the long shadow cast by the oil sands sector,” the Globe and Mail reports, citing a group of companies led by Calgary-based Encana Corporation. And they’re looking for an exception to federal carbon pricing policies to help them make the transition.
“Companies that are employing innovations in drilling and hydraulic fracturing insist they can boost investment, employment, and exports while contributing to efforts in Canada and around the world to reduce emissions of greenhouse gases,” the Globe notes, citing a conference call with Encana CEO Doug Suttles and representatives of two other companies. But in the same breath, “the executives are mounting a lobbying campaign to convince provincial and federal governments of the Canadian sector’s need for streamlined regulations and breaks on carbon pricing so it can remain competitive with the tight oil and shale gas producers in the United States.”
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Alongside Encana, the companies participating in the venture include Modern Resources Inc., STEP Energy Services Ltd., Tourmaline Oil Corporation, Crescent Point Energy Corporation, and ARC Resources Ltd. Suttles told the Globe he had discussed the plan with Natural Resources Minister Jim Carr.
Canadian fossil shares are down more than 20% this year in the face of “a C$30-billion sell-off by multinationals from the oil sands, mounting opposition to federally approved pipelines, and the cancellation of a proposed liquefied natural gas project on the west coast,” the Globe notes. But “the coalition of producers says there is potential for $7 to $10 billion a year in new investment in the most promising Canadian exploration regions, a significant boost for governments that can no longer count on the oil sands to generate tax revenues.”
While the companies “are also promoting the environmental benefits of light oil and natural gas compared to the carbon-intensive oil sands,” Environmental Defence National Program Manager Dale Marshall wasn’t sold.
“To address climate change, we need to get off fossil fuels, not invest in a different process to get more,” he told the Globe. “Investing in fossil fuel infrastructure means higher GHGs for the country.”