Page 5 - NorthAmOil Week 42 2022

NorthAmOil COMMENTARY NorthAmOil

Alberta’s oil sands
producers are working
to decarbonise in line
with federal net zero
goals.

in oil prices this year, but have continued to pri- Twitter that Smith’s comments on Ukraine had
oritise returning money to shareholders over damaged Alberta’s international standing as a
any significant new investments in oil sands stable, secure energy provider. According to her,
capacity. And – together with MEG Energy and in the long term this would mean less investment
ConocoPhillips Canada – the four companies and fewer jobs in the province.
are members of the Pathways Alliance, which “An apology is one thing. Now, we need a plan
operates a combined 95% of Canada’s oil sands to fix it,” Notley said.
production and is aiming to achieve net-zero Polling by Navigator in Alberta in the wake
emissions from those operations by 2050. of Smith’s swearing in show that there has been
Despite this hesitation on the part of oil sands no uptick in support for the UCP following the
operators, though, Alberta’s crude production leadership change. Indeed, the party continues
reached a record high of 3.6mn barrels per day in to trail behind the NDP in the run-up to next
the first half of 2022, representing an increase of year’s provincial election, according to that poll.
100,000 bpd on the first half of 2021. The Alberta However, the province is traditionally a conserv-
government wants to encourage this growth, and ative stronghold and the UCP still has strong
also wants more export outlets for its oil, though support in rural areas. These operators
this will likely require the co-operation of other Current voting intentions in polls do not
provinces and the federal government. necessarily reflect how the election will play out, have benefited
and there is still time for support to shift. In the from the rise
What next? meantime, though, Alberta can be expected to
Trudeau congratulated Smith on her leader- have a more confrontational relationship with in oil prices
ship victory earlier this month and called on the federal government in Ottawa as Smith sets
her province to work together with Ottawa to about pursuing her agenda. this year, but
build a better future for Albertans “by deliver- But while oil and gas producers in the prov-
ing concrete results, making life more afforda- ince will likely welcome her stance on Alberta’s have continued
ble, creating good jobs, and more”. However, in natural resources, it would not be surprising if to prioritise
practice the two leaders look likely to clash on they continue to tread more carefully when it
issues such as climate change and the question comes to projecting a more climate-friendly returning money
of how oil sands production will fit into federal public image. This is what played out in the US
net zero targets. under former President Donald Trump, who to shareholders.
Smith has also already come under fire from talked up US energy dominance and pushed to
provincial New Democratic Party (NDP) leader unleash more domestic oil and gas production.
Rachel Notley – Kenney’s predecessor as Alberta Trump found his vision constrained to some
Premier – after having to apologise for comments degree by producer caution amid oil price fluctu-
made on social media in April in which she ations and growing public concern about climate
suggested Ukraine being neutral was the “only change. A similar scenario could well play out in
answer” to its invasion by Russia. Notley said on Alberta now.™

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