While tar sands/oil sands executives are greeting conditional endorsement of Enbridge’s Line 3 pipeline by Minnesota policy-makers as good news, sector CEOs say more regulatory certainty—and lower taxes—will be needed to ensure that spooked investors once again park their dollars in pipelines, reports the Canadian Press.
Set to run southward between Hardisty, Alberta and Superior, Minnesota, the Line 3 pipeline replacement project will “add about 375,000 barrels per day of export capacity into the United States,” CP notes, adding some of the new export capacity the industry has been demanding for so long.”
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But while they maintained that the expanded market access was good news, fossil executives on a panel at the TD Securities Calgary Energy Conference last week said further major expansion projects will not go ahead without “improvements to federal and provincial regulatory predictability and taxation levels.”
Even though rising oil prices could make Canadian energy companies almost $30 billion richer than they were in 2017, panelist Peter Tertzakian of Calgary’s ARC Energy Research Institute said very few are “thinking about more drilling or buying competitors.” Most of them will pass on the wealth to the shareholders, in the form of share buybacks or dividend increases.
Tertzakian added that the sluggish investment of the past few years owed not only to low energy prices, but also to what he claimed was “a successful but inaccurate campaign by environmentalists to suggest the world won’t need oil after the middle of the next decade.”
Also attending the TD conference, reports CP, was OPEC President Suhail Al Mazrouei, energy minister for the United Arab Emirates, who confirmed the reluctance to invest in oil and gas is a global phenomenon.
