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Automatic TRANSCRIPT

There's no way to solve an energy issue in Canada right now without making some part of this country very very angry and now that the price of oil no longer guarantees a huge payoff in return for that anger. Companies are wondering if it's even worth attempting new projects tech resources announcing it's what's wrong. Its application for the frontier project. This comes just hours. After the Alberta government announced it struck a deal with to northern Alberta first nations. Of course you also can't just walk away from an energy project in Canada today without some people also getting very very angry but at least they won't be angry you. There is absolutely no doubt that this decision was taken in large part because of regulatory uncertainty and endless delays created by the national government by now. No one should be shocked to learn that. There's a lot of resentment of the federal government in Alberta. It's always been this way. It feels like it's getting worse and this time. Alberta probably has a point whatever side of the debate over climate policy versus energy policy. You might said on. It's clear that there's no big framework when it comes to approving or denying energy projects like the one tech has walked away from these projects seem right now to be handled on a case by case basis in Canada. Really continue to do business that way and if it does how will companies like tech choose which projects they push or wet and what comes home for the province of Alberta without a mine. They were counting on for thousands of jobs. Are we reaching a tipping point in the ever? Frayed relationship between the province and Canada's capital or at least the government currently sets there. I'm Jordan Heath Rawlings. This is the big story Jason Marcus off the Albert correspondent for Maclean's and also occasionally for US I Jason. Hello. Why don't you start for Ontarians and East coasters? Maybe everybody who hasn't had quite so much of an economic stake in this by just Sketching out what is tech resources. And what was I? Guess the Frontier Project Tech Resources Everybody should remember is actually not an oil company using its well companies who develop oil sands but this is actually a mining company. Their specialty is coal mines other mineral mines. They had dabbled a bit in oil sands being junior partner in one project and on this one they were trying to propose this one. All on its own This would have been an oil sands mine up quite far north of Fort mcmurray the most remote from the actual city of Fort mcmurray North East Alberta and this was one of the big classic mining projects where they basically dig up the muck the oil sands muck and refine it into `bitumen and keep refining it and keep refining until it eventually becomes oil. That's the classic oil says project. A lot of it has projects that had been developed in the last Five six years have been smaller projects where they just shoot a bunch of Stephen Chemicals and minerals into the oil sands well and dig it up. Those are smaller projects. This is going to be a big mega project. Two hundred and sixty thousand barrels a day at full completion twenty point six billion dollars of to construct this project of course though it was very hypothetical because what they needed to develop a beggar project was around seventy seventy five dollars barrel oil right now. We're at fifty. We habit around fifty four quite a long time and they needed pipeline. You know ones are coming. But it's not clear that there wouldn't necessarily be capacity if Trans Mountain and other projects don't come to be and they needed another partner to get this done big oil sands company or oil player to help them develop and finance this project and over the last five years we've been talking about companies leaving the oil sands. Nobody WANTS TO INVEST. Because it's high risk no intense carbon footprint Very controversial projects. So it was always very unlikely that this project might have ever been built. We were always debating hypothetical emissions hypothetical jobs but in Alberta of course people are very excited by those hypothetical jobs right but what killed it. Finally this week. Oh a few things. Different things killed it. I would be The decision pointed had Facing staring in the face Cabinet was supposed to It's deadline was this week whether it would approve the project reject the project. Or maybe give it some kind of deferral or delay and that's the cabinet in Ottawa. That's the at the Federal Cabinet Justin Trudeau's cabinet and for many reports a lot of cabinet ministers and certainly backbench. Mp's very split on this project. There was a lot of opposition a lot of these. Mp's are from you know. None of them are from Alberta. They're all from other provinces mostly in the east and those are places where there are not tantalized by this prospect of Seven thousand potential oil sands jobs. They think more about the the natural disturbance in an area that's actually in a bison range Very close to a UNESCO World Heritage Site National Park the Wood Buffalo National Park up on the border with North West territories and they would have seen this potential for four point one megatonnes of carbon emissions in the future Per year as we're looking to whoever deuce our carbon emissions normally and this is what tech and this is what other governments were used to This approval process cabinet decision. Making process was pretty much a rubber stamp if the technical review and the federal and provincial panels say this projects okay with conditions. That's what the federal government said liberal and Conservative in the past. They all approved it. That's why we have so many oil sands projects and a whole bunch more that are approved but not built yet. It's different times are shifting. The public public attention is shifting. Investor mood is shifting and so it's quite natural that a liberal government would shift with those times and have be hesitant on whether to approve this or not with this hesitation. Clearly tech thought. Maybe we're not going to get this. Maybe our lease is going to have a big fat rubber no stamp on it instead of a rubber stamping. Yes go ahead. So they decided rather than risk losing this project they pulled it. So what would be the rationale behind that as opposed to just letting the process play one way or another? I mean there are a couple theories out there. One is that a company wants to save face. It wasn't one all of its good intentions. All of its Its efforts to project a good project with good environmental credentials. All of its support for first nations in the region. They don't want all that to be faced with rejection. That's kind of a corporates much That basically what you do is not good enough for the federal government even though this is the defacto defacto message like that still. That's that's the reason you want to put this over. Check this out on your own terms. You want to be able to say what you say rather than Ottawa. Having its say on you another possible Rationale for this is that what are the reports that there is that they were feeling they were feeling that this was going to be delayed and they've sunk so much money into this more than a billion dollars into this planning and consultation process thus far project is valued at basically nothing in the markets according to a good global mail report haunt from their mining reporter and they just want to cut their losses another theory and this is one that I are partially hold. Is that what they had? Right now wasn't oil sands lease. They had a piece of land up in Northeast. Alberta with a proposed mine on it if they had approved mine on it approved mine project on this land. It's worth a bit where he can sell it to likely to find somebody else to take it forward. If this mining comedy didn't want to take this forward if they have rejected mine on it. This land is good for Bison and nature and not much else if they have if they have a hold withdrawn agreement on this proposal on this land. There's still the potential for somebody. Maybe someday in the future under some different government or some of their different perspective with a different proposal maybe with different terms to pick this up again so it could potentially salvage value in this lease. Although I would suggest that it's probably pretty nil at this point so I know you said that in Alberta it's kind of been a hypothetical For a longtime but there were at least a lot of hypothetical jobs in revenue there. So how has Albert or maybe just the leaders in Alberta because I don't WanNa pay the whole province With the brush but how is the Alberta government been taking the news the Alberta government like much you know is very aligned with a lot of the investor community in Alberta oil sands sector and a lot of the populace in oil producing regions like Fort mcmurray? And at least it was the idea that the there could be jobs in the future oil sands rests on two separate separate entities. I mean the whole soil says boo was to its operations actually producing oil sands and growth expanding oil sands and actually the big. The big source of jobs are in constructing these oil sands project and developing these oil sands projects and for years and years and years the big growth for Murray was not the people who actually mind. The product is people who build those minds and build those giant well sites and build the camps and all according structure around those the big boom ended because nobody was putting forward more projects to keep expanding back in two thousand eighteen Ford hills mine Which is the closest mine up to this? Where Tech was going. It opened a big mine owned by SUNCORP now. She partially owned by Tech Resources. It was called at the time in two thousand eighteen. Probably the last big oil sands mine. And that's because no other company was putting them forward except for tech resources. Big Long Shot Project. I may never be built. But but there was excitement in the oil sands community and in the government and in the sector because the potential the idea that another mind could be built is a jobs. Bonanza and sort of jobs bonanza we were used to Albert at developed this province as the screaming Beeman economic superpower. But that we haven't had so the idea that there could be another big mine on the books for when oil prices potentially rose again and it was approved the green light from Ottawa despite all our climate talk That was exciting. The that that the potential is snuffed. Out is a major disappointment here in. Alberta. Who are they blaming? For that disappointment because one thing. I will note is that this wasn't killed by Ottawa. Or was it almost killed by Ottawa? A even if they didn't rubber stamp it it was almost killed by Ottawa. That was the sense you know largely Ottawa. Ottawa was the decision maker in this point and if tech was very confident that this was going to get an approval they would have just Let that happen and would have been fine and Alberta would have been generally mall pleased that this was at least a in our project that could go forward right you know and do people here think Oughta killed it. Of course they do. This is the resource sector in government and Jason Kenny and Justin Trudeau. You know they are predisposed to blaming and directing scorn almost entirely Justin Trudeau for something and in this opportunity. They have a lot of. They have a lot of evidence that argues in their favor that had their Bandai conservative government or had there been a more classical government that just rubberstamps projects and doesn't really take into account all the cumulative impacts of Oil Sands Development and climate liability and climate risk. The this project would have