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NDP and oilpatch continue awkward first dance

07/09/2015 11:00 EDT | Updated 07/09/2016 05:59 EDT
The dance between Canada's energy industry and Alberta's new NDP government is finding a new rhythm during Stampede week in Calgary. 

A day after Alberta Premier Rachel Notley wooed a non-partisan crowd of energy folks and international investors with a speech that seemed straight from the Tory playbook, a pair of top energy executives took the stage across town to deliver their own message to a collection of new NDP cabinet ministers. 

Top of mind on this day? Environmental policy.

"When we think of policy issues, one role the government does have is setting long-term objectives and I think sometimes where they miss the bar is when they say 'how,'" said Encana chief executive Doug Suttles at a lunch event put on by the Calgary Chamber of Commerce. "As governments set these targets, I think they need to let people go out and find the most effective way ... picking winners is difficult, very difficult." 

The wants of industry, of course, are ever the same. When it comes to issues such as environmental policy, they'd like governments to lay down a broad agenda and then let market forces decide the particulars.

Whether a hands off ethos — long a given during much of the PC party's 44 years atop Alberta politics — will continue to hold sway under the new NDP government is now an unfamiliar question mark for Canada's oilpatch. Political stereotypes would suggest an NDP government will be more inclined to tell the industry exactly how it needs to go about meeting environmental targets. The prospects of the policymakers taking such a prescriptive approach is something that keeps energy executives up at night. 

"Let the people in the industry, the people that know their customers, figure out the answers," said Greg Abel, chief executive of Berkshire Hathaway Energy. "We'll get to great answers, we need time and we need more flexibility."

At a glance, Suttles, the head of one of Canada's biggest energy companies, and Abel, a candidate to succeed Warren Buffet in the big chair at Berkshire Hathaway, were simply participating in a lunchtime panel discussion in front of an industry friendly crowd. A closer look, however, shows their comments were pointed directly at a small group at the front of the room that included new cabinet ministers Shannon Phillips (environment), Joe Ceci (finance), and Lori Sigurdson (jobs).

In the months since the election, industry and the new government have taken turns as lead partner in an uneasy two-step. 

One day, the premier is making the right noises to soothe the jangled nerves of the energy industry. The next, industry is trying to sell the government on the merits of market-driven innovation. Off stage, however, both sides continue to seem keenly aware of the practical and philosophical disconnects that exist between their tribes. 

"It's going to take a lot of events and conversations to make people more comfortable," said Duane Bratt, a political scientist at Calgary's Mount Royal University. "Change is difficult, it will take a while, especially considering some of the rhetoric the NDP had given while they were in opposition, but I think they realize this is an energy dominant economy in Alberta and they can't go about trying to destroy that."

Amid the speeches, open houses and meetings, both sides know billions of dollars are at stake. Especially during a time when oil prices are down, industry is chilled by the prospect of costs going up. The new government, for its part, has a vested interest in companies continuing to funnel a steady stream of royalty dollars into the provincial treasury.

The equation seems straightforward enough, but that doesn't seem to offer much comfort to either side. Oilpatch executives continue to take every opportunity to remind the new government that investment dollars can always find a home in another jurisdiction. It's a message Suttles once again delivered at the lunch event.

Lulling words from Notley or otherwise, she and her new cabinet ministers, the energy industry frets, still have their own ideas.

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