MOOD
SWING An exclusive national survey shows energy matters to Canadians. But there are still dividing lines By Darren Campbell & Jeff Lewis Poll conducted by Leger Marketing
A
fter years of ambivalence, Canadians are finally taking a shine to the energy sector. Sure, they still fret that the industry is too dirty, its environmental footprint too large, and its practices too unsustainable. But they also recognize the tremendous impact it has on the Canadian economy and that the sector is making strides to improve its environmental and social performance. That is one big takeaway from an opinion poll conducted by the Alberta office of survey firm Leger Marketing. “There is an opportunity for Alberta to change the message here,” says Ian Large, Leger’s vice-president for Alberta. “To some extent we have to give up the angst over the National Energy Program and refocus the debate.
Energy is a national issue now, not a western issue.” Indeed. As British Columbia goes gaga over liquefied natural gas export terminals, Saskatchewan enjoys burgeoning oil production, Ontario cashes in on manufacturing jobs created by oil sands development and skilled tradespeople from Atlantic Canada fly en masse to Alberta’s bitumen belt, Canadians can see the impact the energy sector is having on their lives. And they are feeling increasingly good about it. This winter Leger randomly selected more than 1,400 Canadians from every region of the country except the North and got their opinions on a variety of energy topics. It is the second time Alberta Oil has conducted this kind of survey with Leger – the inaugural one was done in 2010.
Reprinted with the permission of Alberta Oil / May 2012
MOOD SWING
“ Energy is a national issue now, not a western issue.” But the times have changed and so have the questions posed to Canadians. In 2010, the survey was taken during a dark time for the oil and gas industry. The Deepwater Horizon disaster that resulted in thousands of barrels of crude oil being spilled into the Gulf of Mexico was fresh in everyone’s minds. So was a verdict that found oil sands pioneer Syncrude Canada Ltd. guilty for the deaths of 1,600 ducks in one of its tailings ponds. That’s why the reputation of the petroleum industry was the focus of the last survey. Two years later, the sector finds itself in a better place and other issues have grabbed center stage. Access to new markets, the environmental impact of hydraulic fracturing and the need for a national energy strategy have emerged as hot-button issues. On the subject of a national energy strategy, the poll found Canadians overwhelmingly support the need for one. However, Alberta respondents were less enthusiastic about the idea than anyone else – a sign that 32 years after Pierre Trudeau established the hated National Energy Program, the province is still wary of any federal meddling in its oil and gas industry. “Albertans don’t want the federal government involved [in a national energy strategy]. But I think the federal government has to be involved and to an extent they have to lead it,” Large says. “If it is western-driven, there is a credibility issue to overcome.” The survey also shows the oil and gas industry has much to overcome to convince Canadians that the Keystone XL and Northern Gateway pipelines are in the national interest. Despite comments from the likes of Janet Holder – Northern Gateway proponent Enbridge Inc.’s point person on the proposed $5.5-billion conduit – that a pipeline designed to ship 525,000 barrels of bitumen production per day from Alberta to the B.C. port of Kitimat is a nation-building endeavor, Canadians aren’t buying the message. Less than 50 per cent of Canadians polled felt the federal government should work harder to allow Western Canada’s oil
Reprinted with the permission of Alberta Oil / May 2012
and gas to reach export markets and that TransCanada Corp.’s Keystone XL pipeline from Alberta to the U.S. Gulf Coast should be built. Support for the Northern Gateway project was even less robust – only 37 per cent of Canadians thought it should be built. The industry also faces an uphill battle in convincing Canadians that hydraulic fracturing, which has helped unlock vast amounts of oil and gas in B.C., Alberta, Saskatchewan and Manitoba, is a safe form of extraction. Fracking has been blamed by critics for contaminating drinking water and even causing earthquakes. Those concerns are not going away. Leger’s polling shows that across the country Canadians are extremely wary about fracking. That wariness has been most pronounced in Quebec, where the provincial government put a halt to fracking in 2011 until an environmental review into the extraction technique is completed. And it’s not just fracking that Quebecers dislike. The survey results shows that Quebec’s attitudes towards oil and gas activity, energy’s role in the economy and the industry in general, are unfavorable compared to the rest of the country. “That’s one dark spot in the study and it’s no different than what we saw in 2010,” Large says. “Quebec is a tough sell. Quebecers don’t think this rising tide is affecting them. Can the oil and gas sector say it has 10,000 Quebecers working in the oil sands? Probably not. The West needs a better engagement strategy there.” The good news for the industry is that public perceptions change. Compared to 2010, Canadians’ views on how credible and trustworthy the petroleum industry is in providing information about carbon emissions, water use, tailings ponds, extraction processes, environmental regulations and more, have improved. Canadians realize the energy sector is the most important economic driver in the country. There is still much work to do in improving its image, but Canadians are coming around. The industry isn’t viewed as the bogeyman anymore.
Q&A
National Energy Strategy
From the
Lobbyists
How strongly do you support the idea that: Canada needs a national energy strategy
David Collyer, president, Canadian Association of Petroleum Producers, on the merits of a Canadian energy strategy Alberta Oil: What is the industry looking for in a national energy strategy?
David Collyer: The key elements of that strategy from our perspective are recognition that we need to continue to responsibly grow the resource sector in Canada. It’s an economic driver. It’s going to be extremely important for the Canadian economy going forward. Diversification of markets is an important part of that. Regulatory reform is an important element, getting to decisions more quickly and making the process more efficient. I think we have to look, in the context of an energy strategy, about how we use energy in Canada, so the consumption side is extremely important. And you can’t talk about energy strategy without talking in some way about carbon and where climate policy fits in to that mix. AO: The Conservative government in Ottawa seems to favor a piecemeal approach to regulating greenhouse gas emissions. Would CAPP support a national price on carbon?
DC: The devil’s in the details. It depends on the design, but we’ve been very clear that CAPP would support a broad carbon pricing policy in Canada. We would prefer to have consistency across the country in terms of the way policy is being administered. That can be achieved through
equivalency agreements between the provinces and the federal government. That’s a potential avenue by which to get more consistency across the country. You have a broad policy framework and then you allow individual provinces within that broad policy framework to implement it in a way that suits their particular jurisdiction and their particular circumstances. AO: Would a credible national policy on carbon allow Canadian petroleum products to access markets where they’ve experienced pushback?
DC: The reality is we’re reaching those markets today. I expect we’ll continue to reach those markets. I think trying to find a strategy that works for a broader suite of interests in Canada would be desirable, if we can get there. And certainly there are steps we can take to try and demonstrate to people internationally that we’re taking a responsible approach to energy development in Canada, which should hopefully break down some of the barriers we’re seeing, whether that be in Europe or the United States. That being said, the world needs energy and we’ve got a lot of it. And we can develop it, I believe, as responsibly as anybody else can … but some proactive policy steps would be helpful in winning broader support.
65.1%
78.2%
Alberta
Canada
9.9%
12.8%
6.3%
12.2%
12.3% Don’t Know Neither Oppose Support
3.2%
The strategy has to be managed by the federal government Alberta
Canada
Agree
30.6%
44.8%
Disagree
36.8%
20.6%
Neither
26.3%
26.2%
6.3%
8.4%
Don’t Know
Energy in all its forms needs to be considered Alberta
Canada
85.3%
83.7%
Disagree
2.7%
3.2%
Neither
6.9%
8.1%
Don’t Know
5.1%
5%
Agree
Industry should play a role in developing a national energy strategy Alberta
Canada
67.7%
65%
Disagree
8.7%
11.3%
Neither
18.9%
18%
5%
5.8%
Agree
Don’t Know
>>
Reprinted with the permission of Alberta Oil / May 2012
Mood Swing
Continued
National Energy Strategy The focus of a national energy strategy should be on improving energy infrastructure Alberta
Canada
Agree
68%
68.7%
Disagree
7.8%
7.5%
Neither
19.2%
18%
4.6%
5.7%
Don’t Know
Hydraulic Fracturing How familiar would you say you are with the form of oil and gas extraction known as hydraulic fracturing or fracking?
Any national energy strategy should be focused on reducing our reliance on non-renewable energy Alberta
Canada
Agree
65.3%
72%
Disagree
10.7%
5.2%
Neither
20.4%
16.2%
3.6%
6.6%
Don’t Know
Quebec 80.5% Agree
We need to consider all forms of energy extraction to reduce our reliance on foreign energy sources
Agree Disagree Neither Don’t Know
Quebec
53.9% Familiar
36.4% Familiar
23% Familiar
How much do you agree or disagree with the following statements about this method of oil and gas extraction: Hydraulic fracturing or fracking puts the quality of drinking water at risk Alberta
Canada
42.1%
51%
Hydraulic fracturing or fracking is a safe form of energy extraction Alberta
Canada
Agree
24.8%
14.8%
Disagree
26.7%
31.9%
21.8%
22%
27%
31.3%
Canada
Agree
72.8%
63.8%
Disagree
7.8%
7.5%
9.1%
11.1%
Neither
15.8%
17.9%
Neither
13.1%
13.4%
Don’t Know
24.2%
25.9%
Don’t Know
5%
11.8%
Alberta
Canada
32%
61.1%
Disagree
43.9%
13.8%
Neither
19.5%
20.1%
4.6%
5.1%
Don’t Know
Canada
Alberta
Quebec 61.7% Agree
A national energy strategy should focus on sharing the oil and gas wealth in Western Canada with the entire country
Agree
Alberta
Ontario 70% Agree Man./Sask. 44% Agree
Reprinted with the permission of Alberta Oil / May 2012
I trust the oil and gas companies when they say hydraulic fracturing is safe Alberta
Canada
Agree
22.4%
15.4%
Disagree
43.7%
53.7%
22%
18%
11.8%
12.8%
Neither Don’t Know
Quebec 66.2% Disagree
Atlantic 60.1% Disagree
Quebec 43.6% Disagree
I am concerned about the environmental impact of hydraulic fracturing Alberta
Canada
Agree
50.9%
59.8%
Disagree
17.1%
10.1%
Neither
19.7%
14.3%
Don’t Know
12.3%
15.8%
Do you agree that we should suspend hydraulic fracturing until we know more about the possible environmental impacts of the practice?
Build It and They Will Come (Around)
B.C. 47.6%
Man. & Sask. 37.1%
Agree
Atlantic 60.4%
A transmission deficit in B.C. hinders northern development
OTTAWA COULD DO MORE TO APPEASE ANXIOUS
British Columbians concerned about Pacific-bound pipelines by paying for needed infrastructure in the northern half of the western province, Alberta’s former Energy Minister, Ted Morton said. “The risk-benefit ratio between B.C. and Alberta needs to be addressed,” he said in a February 27 interview. “Northern British Columbia needs infrastructure, not just for Northern Gateway or the gas pipelines, but for mining, for forestry – all the other products there.” “I think given the fact that the majority of the taxes collected off the growth in the oil sands will go to the federal
Markets
government, that the federal government can play a constructive role in facilitating that transportation infrastructure.” The remote region in B.C. needs more than roads, says Alex Pietralla, executive director of the Kitimat-Terrace Industrial Development Society. “Anything that could be brought to the table that brings more opportunities to the region and to the area is very much accepted and appreciated,” he says. At the top of the list are transmission lines and generating capacity required to power a suite of isolated mining proposals. Plans to liquefy and ship natural gas to overseas markets will also require additions to the grid. “We don’t have the power to do all the projects that are sitting on the table,” Pietralla says. The proposed Northern Gateway pipeline to send Alberta oil sands bitumen across the interior of B.C. to Kitimat, B.C., should be built
Building energy infrastructure like the Keystone XL and Northern Gateway pipelines are nation-building endeavors 55.2%
46.8%
Alberta
Canada
Agree
53.7%
37.3%
Disagree
26.7%
32.6%
Neither
12.3%
14%
7.2%
16.1 %
Don’t Know Alberta
B.C. 41.2% Disagree
Canada The royalties and taxes that governments will take in due to exporting oil and gas to Asian markets will benefit all Canadians
Ontario 50.2% Agree 18.1%
Alberta 38.3%
Quebec Canada & 58.2% Ontario 50.5%
5.7%
24%
21% Don’t Know Neither Disagree Agree
Alberta
Canada
Agree
63.9%
49%
Disagree
16.6%
23.3%
Neither
12%
18.1%
Don’t Know
7.5%
9.6%
7.5%
21.6%
>>
Reprinted with the permission of Alberta Oil / May 2012
Mood swing
Canada should do more to diversify the export markets for its oil and gas generally
Agree Disagree
Continued
Markets
Neither Don’t Know
Alberta
Canada
66.3%
56.3%
10%
14.4%
18.1%
22.1%
5.6%
7.2%
Building these pipelines will provide important, high-paying jobs to Canadians Alberta
Canada
71.9%
62.4%
Disagree
12%
13.2%
Neither
12%
18.4%
Don’t Know
4.1%
6%
Agree
Exporting our oil and gas to Asian markets is a national priority 42.6%
38.5%
Alberta
Canada Quebec 22.8% Agree 30.2%
5.2% 22%
30.2% Don’t Know Neither Disagree Agree
Oil Sands
A Way Forward
Canada should not allow foreign ownership in oil sands development
First Nations want a seat at the table COURT CHALLENGES AND BLOCKADES ARE NOT
the default reaction of Canada’s First Nations to major energy projects. They are the result of neglect, suggests the head of the Assembly of First Nations. In remarks following an address to a Calgary business crowd March 1, National Chief Shawn Atleo challenged the energy industry to help break a pattern of “lurching from conflict to conflict” where major resource projects concern aboriginal communities. “There’s a pattern here, and it’s time that we learned from that pattern, particularly when it comes to major resource development,” he told Alberta Oil. Staunch opposition among some bands to Enbridge Inc.’s proposed Northern Gateway pipeline to the West Coast is just one example of a broader trend: “There is a similar dynamic from coast to coast to coast on all major projects,” Atleo says. First Nations are too often consulted on energy projects purely out of a legal obligation, he adds. “That’s not conducive to real respect for treaty rights, or to a full partnership,” he says. Aboriginal communities “do live in isolated parts of the country, right beside the minerals [and] the gas reserves that industry is seeking. It makes a lot of sense to invite First Nations into the discussion now in a meaningful way.”
Reprinted with the permission of Alberta Oil / May 2012
25.2%
6.1%
Alberta
Canada
53.1%
64.9%
Agree
22.6% Disagree
17.7% Neither
Agree
4.1% Don’t Know
Too many foreign companies are involved in oil sands development
Oil sands development only benefits the western provinces
11.6% Disagree
14.5% Neither
9% Don’t Know
Alberta
Canada
Agree
53.4%
53.4%
Disagree
15.1%
9.1%
Neither
20.7%
19.8%
Don’t Know
10.7%
17.6%
Alberta
Canada
Agree
12.1%
35.2%
Disagree
71.6%
33.8%
Neither
12.3%
22.7%
3.6%
8.3%
Don’t Know
Quebec 49.3% Agree
Atlantic 40.7% Agree
How concerned are you about the following issues facing the oil sands?
Public Priorities
How important are the following priorities?
Improving the health care system Concerned
Not Concerned
Don’t Know
Greenhouse Gas Emissions Alberta
81.2%
Land Clearing
80.2% Native Land Rights
Tailings Ponds
Important
Canada
Important
90.5% Not Important
Important
95.3%
Canada
Important
97%
Improving the education system
Water Quality Issues
Alberta
Important
95.9%
Canada
Important
95.9%
Alberta
Important
Canada
Important
Not Important 91.1% 93.7% Not Important
Alberta
Important
95%
Canada
Important
96.4%
Canada
88.9%
Not Important
More opportunities for skilled employment 77.3%
Sharing economic opportunities with Canadians 86.8%
Harm to Wildlife
Alberta
Important
Canada
Important
Not Important 87% 92.6%
Canada
81.3%
Encouraging immigration
86.8% Pipeline Construction Alberta
85.1%
Alberta
Canada
76.4%
59.6%
Alberta
Not Important
Improving the natural environment 59%
Alberta
98.2%
Canada
51.5%
Alberta
Important
Canada
75.2%
Alberta
Canada
Improving the country’s infrastructure 85.7%
Alberta
97.7%
Canada
86.4%
Alberta
Important
Developing a national energy strategy
Water Use Alberta
Alberta
Canada
74.9%
Not Important
Canada 69.4%
Alberta
Important
Canada
Important
Not Important 43.4% 42.4%
>> Reprinted with the permission of Alberta Oil / May 2012
mood swing
Oil and Gas Industry
Do you think the western provinces have an obligation to share their natural resource wealth with the rest of the country? Alberta 42.4% Disagree
19.9% Neither
Ontario 66.1%
Canada 3.7% Don’t Know
16.9% Disagree
22.5% Neither
Alberta 32.3%
Agree
Canada 55.1%
6.4% Don’t Know
Mass Appeal The oil patch’s thirst for labor knows no bounds IT WILL REQUIRE A MULTI-
pronged strategy if firms in the oil and gas business are going to solve their worker woes. “Gone are the days where a single recruitment strategy would fill all your talent needs,” says Mike Winterfield of Randstad Canada, a staffing, recruitment and human resources firm. With companies scrambling to find the workers they need as drilling and production forecasts rise in Western Canada, having a comprehensive recruitment strategy has never been more important. For example, Atlantic Canada has been fertile ground for finding skilled labor in the past. But the energy sector cannot depend on that region
to make up for the entire labor shortfall. “The economy there isn’t doing as well as Alberta,” Winterfield says. “But even that is changing and it makes it a challenge.” In order to attract that valuable commodity – the skilled worker – Winterfield says firms must enhance their company brand and be seen as an employer of choice; they must seek out skilled workers in other industries to see if they can be cross-trained; and they must mentor junior staff and promote from within the company. There is no magic bullet to the labor shortage, Winterfield says. Instead, companies need all the ammunition they can get to deal with it.
Reprinted with the permission of Alberta Oil / May 2012
The energy sector is a desirable place to work Alberta
Canada
68.2%
58.2%
Disagree
9.4%
7.3%
Neither
16.5%
25.14%
5.9%
9.4%
Agree
Don’t Know
Canada is a leader in green energy technology Alberta
Canada
Agree
29.9%
26.6%
Disagree
33.5%
35%
Neither
29.3%
30%
7.3%
8.4%
Don’t Know
Quebec 45.1% Disagree
Economic benefits Agree of oil and gas development Disagree outweigh Neither environmental concerns Don’t Know
The oil and gas sector is the most important driver of the Canadian economy as a whole 59.2%
42.1%
There are opportunities for all provinces to benefit from oil and gas development in Western Canada
Canada
Alberta
Quebec 45.1% Disagree
Alberta
Canada
33.9%
32.1%
41.4%
40.8%
21.7%
21.9%
3%
5.2%
Alberta
Canada
Agree
77%
54.5%
Disagree
6.1%
16.6%
Neither
11.7%
21.7%
5.2%
7.2%
Alberta
Canada
Agree
32.3%
55.1%
Disagree
44.2%
16.9%
Neither
19.9%
22.5%
3.7%
5.5%
Don’t Know
9.2%
5.7% 13.9%
21.1%
25.2%
23.5%
The western provinces have an obligation to share their natural resources wealth with the rest of the country
Don’t Know Neither Disagree Agree
Don’t Know
Ontario 66.1% Agree
Public perceptions of the oil and gas sector Year: Oil Security and Independence 14.4% 22.4%
10.1%
Canada
Alberta
Offshore Drilling
36.7%
19.2%
Alberta
Canada
13% 5.4%
Canada
16.4% 26.4%
Environmental Regulations in the Oil Sands Development Area
Carbon Emissions 9.6%
2010
13.5% 27.5%
Alberta
17.7%
2012
Oil Sands Development
17.5%
11.3%
You believe oil and gas companies to be credible and trustworthy when it comes to providing information on each of the following areas:
22.8%
Alberta
8.5%
17.5% Alberta
Canada
Justifying Gas Prices at the Pump 9.9%
13%
5.1%
Canada
10.4%
Alberta
7.1%
6.6%
Canada
AO
Get more results from our second national survey on energy views at www.albertaoilmagazine.com/survey2012
Reprinted with the permission of Alberta Oil / May 2012