The new oil sheik of Quebec – by Sophie Cousineau (Globe and Mail – February 6, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

MONTREAL — To say that I am a football fan is an overstatement as big as New Orleans’ Superdome, though I’ve always had a soft spot for the San Francisco 49ers. But I gave up on “my team” and on the Super Bowl when the Baltimore Ravens’ lead reached 22 points, and switched to Tout le monde en parle, the talk show that normally rules Quebec airwaves on Sundays.

So I missed the power outage and the 49ers’ spectacular comeback. But I did see Quebec’s Natural Resource Minister, Martine Ouellet, throw a couple of Hail Marys.

This may come as a surprise to those who have heard of Quebeckers’ widespread disdain for the oil sands, but the province of cheap, abundant hydroelectricity has some big oil ambitions of its own.

On the Radio-Canada talk show, Ms. Ouellet talked about the revenues that could be extracted from Quebec’s oil reserves. The Gaspé region could generate $35-billion, she said. The Anticosti Island? Between $200-billion and $300-billion. The Old Harry offshore deposit in the Gulf of St.-Lawrence? A whopping $500-billion! (A press officer corrected her Tuesday and said she had meant to say $50-billion, but still.)

The show’s court jester, Dany Turcotte, was flabbergasted at those huge figures, which conjured up images of oil gushing from a swamp like in the opening of the old Beverly Hillbillies TV series.

Until now, the reality has been very different. Quebec’s oil is hard to extract. In the past 10 years, junior resource companies poking the land have only succeeded in pumping a couple of hundred of very pricey barrels from exploration wells.

“You have got to be careful before asserting that we are going to be as rich as Alberta,” says Jean-Yves Lavoie, chief executive officer of Junex, a Quebec exploration company. There is still a lot of work to be done.

There is only one deposit close to being commercially viable, according to its promoter, Pétrolia Inc., and that is the Haldimand project near the town of Gaspé, where exploratory work is now halted.

But Premier Pauline Marois is determined to see Quebec reduce its reliance on imported oil. And for a cash-strapped province that is cutting expenses in all departments to balance its books, extra oil royalties would ease some fiscal pain.

Even Ms. Ouellet, a former water conservationist who denounced “fracking” as unsafe in her first days in a limousine, is officially riding along, although she advocates moving with extreme caution. Fracking is a technique that injects a chemically-laced solutions underground to fracture rock formations and release oil and gas.

For the rest of this article, please go to the Globe and Mail website: http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/the-new-oil-sheik-of-quebec/article8282120/?ord=1

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