NL may have dodged one offshore bullet, but well-informed
sources in the Nation’s capital advise that the public were given only one
part of the story.
The Federal Cabinet has agreed, over objections
from Environment Minister Steven Guibeault, to allow Bay du Nord to proceed. But
so far unannounced is that Ottawa has extracted from Premier Andrew Furey an agreement
that in return, no other offshore oil development licenses will be issued. Ottawa
does not want to be seen doing the killing alone.
This compromise was the cost of the Fed’s $2
billion loan for “rate mitigation”. A more mature, savvy, politician would have
told Ottawa to stuff it. Furey has agreed to the price.
The “noise” that you are hearing from local media,
over the past few days, revolves around climate friendly wind power and hydrogen.
What you are hearing is a structured campaign giving
the impression that your future is connected with these energy sources rather than
oil – though the globe needs oil and we have some of the lowest carbon emitting
stuff. It is a more important industry than many people, including our own, fully understand.
Premier Furey and Natural Resources Minister,
Andrew Parsons, are active parties in this PR job. It includes rebranding C-NLOPB,
provincial legislation to lift the embargo on wind energy development, and environmentally
“sexy” hydrogen.
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| Minister Seamus O’Regan |
That is not to dismiss hydrogen’s potential. Just don’t let
political rhetoric mislead you to thinking that we can shut down the offshore oil
sector tomorrow and presto, wind power and hydrogen development is going to replace those jobs.
And, on the subject of wind, if it is not used in the manufacture of hydrogen, what market will it serve? The Maritime Link has been sized essentially to
transmit only surplus power from Muskrat Falls.
Of course, politicians have grown used to teasing the locals with visions of Gull Island; wind and hydrogen are just the new “magic beans”.
Premier Furey leaves the impression that the offshore oil industry is easily replaced. The PR types smell a public as gullible
as ever, especially those attracted to environmental buzzwords and gobbledygook.
Real project economics? Oh c’mon!
There is another feature to this story about which my Ottawa sources know plenty: NL Minister Seamus O’Reagn and Gudie Hutchings may
as well have been in Timbuktu for all the help they were to the Bay du Nord decision.
Bay du Nord was salvaged only because Deputy Prime Minister Chrystia Freeland and International Trade and Business Minister, Mary
Ng, forcefully argued that aside from a potentially very costly lawsuit originated by Norwegian oil company, Equinor, any action taken to kill off Bay
du Nord would have sent the worst possible reputational signal to the global investment community of the risk of investing in Canada.
Environment Minister Steven Guibeault is not happy. But he will have the last laugh now that the Feds, with Premier Furey onside, are back in full control of new exploration licenses.
For that reason, there is more to this story. Uncle Gnarley’s correspondents are on the trail of SNC Lavalin. There will be no shortage of funding in Thursday’s Federal Budget for studies, including for hydrogen and other things “green”. The fringe groups of B.C. and Central Canada will be sated and, just as important, Ottawa’s favourite consultants – and a few locals, too – are ready for a new
gravy train.
Just you remember…only boondoggles need apply.