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Mulcair says Canada pipeline plans falter without public backing

THEOPHILOS ARGITIS

OTTAWA, Canada (Bloomberg) -- Thomas Mulcair, leader of Canada’s main opposition party, said Prime Minister Stephen Harper’s efforts to construct energy infrastructure are failing because the ruling Conservatives haven’t built public support.

An approach that creates refining jobs in Canada, addresses concerns of First Nations groups and builds credibility on climate change would be more successful, Mulcair said in an interview at Bloomberg’s Canada Economic Summit.

“If you don’t have a social license at the same time you are getting the regulatory license, nothing gets built,” said Mulcair, adding the nation needs to find an outlet for the its petroleum products.

Access to market for the country’s energy resources has become a key issue for the Canadian economy, with opposition to new routes for oil and natural gas exports the biggest risk to Canada’s growth outlook, Scotiabank chief economist Warren Jestin has said.

“We have a government that was probably of the impression they were doing what a lot of businesses wanted.” Mulcair, 59, said, referring to budget moves to streamline approvals. “What was seen at the beginning as being a bit of a gift has actually turned into a bit of a poisoned chalice.”

Producers such as Royal Dutch Shell and Total are counting on pipelines including Enbridge' s Northern Gateway and TransCanada' s Keystone XL to ease a transportation bottleneck that’s suppressing the price of Canada’s heavy crude, costing the economy as much as C$50 mn ($46 mn)per day, according to the Canadian Chamber of Commerce.

A lack of pipeline access to the continent’s coasts has contributed to keeping the price of Canada’s heavy oil about $20 a barrel less than the U.S. benchmark over the past four years.

Canada’s focus should be on value-added products such as refined petroleum, Mulcair said, adding he would be more inclined to support TransCanada' s Energy East pipeline that would ship crude to refineries in eastern Canada than Keystone.

“We view the Energy East project a step in the right direction,” he said.

Mulcair reiterated his party’s policy to implement a cap and trade system to reduce greenhouse gas use and help Canada rebuild international credibility on the issue. He declined to commit to adopting Canada’s commitment under the 2009 Copenhagen Accord to cut emissions 17% below 2005 levels by 2020.

“When we come into office, we’ll run the numbers,” Mulcair said. “I can’t tell you today exactly what the state of play will be in 2015, but I can tell we’ll get back to work on this.”

Mulcair is a former Quebec environment minister who was elected NDP leader two years ago. The second oldest of 10 children, Mulcair was born in Ottawa and raised in Laval, Quebec, just north of Montreal. He holds a law degree from that city’s McGill University.

Mulcair replaced Jack Layton, who died from cancer only months after leading the party in 2011 to the best election result in its 50-year history, largely due to a breakthrough in Quebec, where they won 59 of the province’s 75 districts. The next election is scheduled for 2015.

While the No. 2 party in Parliament, the NDP has fallen to third place in public opinion polls. Mulcair’s party has averaged about 22% in recent surveys, compared with 30% for Harper’s Conservatives and 35% for the Liberal Party, according to poll aggregator threehundredeight.com.

05/14/2014

 

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