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Varcoe: 'Act urgently': A new recipe for getting big energy projects built quickly in Canada

'We just need to understand, what are the rules of the road,' said Alex Pourbaix, chair of Cenovus Energy and incoming chair of the Business Council of Alberta

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Alberta wants a new oil pipeline built to the British Columbia coast. Ottawa wants a major carbon capture network developed in this province.

Alex Pourbaix, chair of Cenovus Energy and a former executive at TransCanada Corp., finds himself at the heart of the action in this country.

And he’s hoping Canada can avoid a repeat of the pitfalls that led to major projects such as Energy East failing to progress last decade, as the country now looks to get more natural resources to hungry global markets through new developments.

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“We just need to understand, what are the rules of the road . . . I hope we’re going to get to a good outcome,” Pourbaix said Monday.

“The biggest concern industry has is that we don’t ever want to be in a position again where we’ve had to invest hundreds of millions of dollars in a proposed project, only to find out at the 11th hour and 59th minute that it is not going to meet the political hurdle.”

Cenovus Energy is one of five major oilsands producers examining the Pathways carbon capture network in northern Alberta.

The group is in trilateral talks with the province and Ottawa on the proposal, as part of the broader energy memorandum of understanding (MOU) signed by both governments in November.

A deadline for the Pathways agreement as part of the MOU arrives Wednesday, although Premier Danielle Smith has suggested it could be extended.

Pourbaix is co-chair on the province’s technical advisory panel that is helping the UCP government examine a new oil pipeline proposal to the British Columbia coast.

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He’s also incoming chair of the Business Council of Alberta, which released a new road map on Monday to get projects and investment moving. The group seeks to restore confidence in reviews of new projects by reforming the federal Impact Assessment Act and the Canadian Energy Regulator Act.

The council’s report contains a series of recommendations on how to “fix Canada’s major project approval process and regulatory system.”

For example, it calls for a political decision early in the evaluation to determine if a major development can proceed — similar to what Ottawa’s Bill C-5 legislation has done with projects designated to be in the national interest — rather than near the end of the process.

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It wants all pipeline reviews to be conducted by the Canadian Energy Regulator (CER), and it seeks to speed up these assessment timelines to a maximum of 180 days for small projects and 250 days for larger developments — and limit all other federal project approvals to two years.

It also advocates for repealing the oil tanker ban off the northern B.C. coast and the federal Clean Electricity Regulations, which are partially addressed in the Alberta-Ottawa MOU.

“Canada must move quickly to restore our ability to compete for major projects in global capital,” Business Council president Adam Legge told an audience Monday morning at the Calgary Petroleum Club.

“The question now is not whether we understand the problem. It’s whether we’re prepared to act, and act urgently, because if our federal government is prepared to do so, Canada can compete.”

Pourbaix, who worked at TransCanada and was the executive in charge of proposed oil pipelines such as Energy East when it was being examined — before he joined Cenovus in 2017 — said it’s critical for companies working on new projects to know if there’s early political support for the development.

For example, TransCanada terminated the $15.7-billion Energy East proposal in 2017 — a 4,500-kilometre pipeline designed to transport oil from Alberta and Saskatchewan to the East Coast — four years after announcing plans for the project. It later incurred a $954-million after-tax impairment charge for Energy East and related projects.

Pourbaix noted that the proposed Pathways carbon capture network and Alberta’s pipeline plan are also multibillion-dollar developments, and industry welcomes the new collaboration with governments, saying it’s going “very, very well.”

“Industry has been very, very clear to both levels of government that we want to invest. We want to grow this energy industry. And, frankly, there’s very few countries in the entire world that have the ability to deliver the oil and gas that the world so desperately needs right now than Canada,” he said.

“There’s some heavy lifting yet to be done, but the intentions from all parties are clearly aligned, and that gives me confidence that we’re going to figure it out and get there,” added Kendall Dilling, president of the Oil Sands Alliance, the group of oilsands operators that has been working on the carbon capture plan.

Gitane De Silva, former CER chief executive, said Monday it makes sense to have pipeline reviews conducted by the energy regulator, where there is extensive expertise on the issue, instead of also involving the Impact Assessment Agency of Canada.

Project reviews must ensure there is meaningful consultation with Indigenous communities, and that economic reconciliation is at the centre of the process, she added.

Other suggestions in the report, such as having a “one project, one review” process — something the federal and Alberta governments recently agreed to — make sense, along with putting political approvals at the start of the process.

Such agreements between Ottawa and the provinces will help eliminate unnecessary duplication, reduce timelines and provide greater clarity, said a statement from the office of federal Environment Minister Julie Dabrusin.

“Moving that political decision up early is absolutely key, because we’ve seen many project proponents invest millions and millions of dollars to get to no,” said De Silva, the principal of GDStrategic.

“With industry calling for and doubling down on some of what the federal government has already said, that sends a positive message to investors that we are serious about doing things differently and actually getting things built.”

Chris Varcoe is a Calgary Herald columnist.

cvarcoe@postmedia.com

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