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J.J. McCullough

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Media Bites: Snuggle Up, We're in Bed with China

Posted: 12/10/2012 12:25 pm

Let it never be said that Stephen Harper is a leader who "hasn't really done anything."

In the last couple of days alone, our PM has done not one, but two anythings, in fact -- and both plucked from the ample list of anythings he's long promised to do, or not.

I know it's difficult to imagine a summary more comprehensive and clear than that, but I've got a word count to fill so we must soldier on.

Let's begin with Harper thing-done number one: his decision to cancel "reconsider" the order for all those fancy F-35 fighter jets, and thus end Canada's longest-running jet-related controversy since Dan Aykroyd killed the Avro Arrow (or whatever, I dozed off during the movie).

Now, the F-35s were always hugely controversial, partially because they were so damn expensive, and partially because it seems our politicians were engaged in some manner of elaborate shenaniganry to systematically obscure just how damn expensive.

Following a scurrilous auditor-general's report last spring, many in the Canadian commentariat predicted with trademark restraint that this monstrously unprecedented scandal of federal politicians fudging the costs of things would irreparably cripple, or even despose the Harper government, with CBC star reporter Kady O'Malley going to far as to suggest that the Tory majority government might even vote non-confidence in itself.

I forget if that ended up happening, but at the very least the April scandal did little to stop the F-35s' price tag from continuing to balloon, and by Friday things had apparently gotten so bad the Harper government had little choice but to pop the entire jet-bidding process and start over.

Which is indeed "bad news from a government that presents itself as a careful steward of the public purse," quips Jeffrey Simpson in Saturday's Globe and Mail. Let's not forget, he notes, that the Harper gang has already spent "hundreds of millions of dollars" on F-35 anticipation alone -- painting the F-35 nursery and so forth -- so good luck to the "Harper spin machine" as they try to spit-shine that doozy.

As Jeff's outbreak shows, a severe case of I-told-you-so-itis plagued most of the nation's editorial pages this weekend, with pundits rushing to dance on the grave of a jet program they were hardly ecstatic about in the first place.

A true "pricey political fiasco," concludes the Toronto Star. The PM's been chasing this toy for years, and yet "the only thing the F-35 has shot down is the Harper government's credibility." And frankly more effort probably went into that one zinger than the entire bidding process.

Even the feisty hawks over at the National Post, who declare that "fearsome" fighter jets "are not optional for Canada" still concede that any future procurement of non-F35 fearsomeness "must be made using a better process than the one that led to this unfolding debacle."

And just what would a "better process" look like, you ask? Well Postmedia's omnipresent Michael Den Tandt figures the politicians should probably abandon their oversight of jet shopping altogether, and just stick some "experienced bureaucrats in charge."

Because remember: when you're a prime minister, often the safest kind of doing is the kind someone else does for you.

***

Moving on, the second big prime ministerial deed done this Friday was Harper's much-awaited blessing of the sale of the Calgary-based Nexen oil sands corporation to the cuddly commies at the China National Offshore Oil Coporation.

Like the F-35 bid, this project's long-standing limbo was very much something our friendly friends in the Canadain punditocracy had been jabbering about for quite a few calendar pages, particularly in the context of the grand debate over which country is run more communistically -- the one whose tyrannical politburo micromanages every aspect of their archaic state-planned economy, or China.

See, in approving the Nexen sale, the PM was famously waffly, saying that while he was willing to sell off a private-sector firm managing a critical natural resource to a state-owned corporation run by a morally-ambiguous communist superpower this one time, the greedy foreigners shouldn't get too used to it. A barely modified "net benefit" test will remain in place, and like the sadistic sixth grade teacher he is, Harps still doesn't plan to tell anyone how to pass it.

In other words, summarizes Andrew Coyne in the Post "the right decision this time, but the promise of endless wrong decisions in future." Like many in the pundo-spehere, Andy has a big problem with the fact that our government is evidently making major decisions about international commerce using no coherent human logic whatsoever. Before CNOOC, he notes, "our foreign investment rules were merely opaque," now they're "both complex and opaque." Joy!

Yeah, lemme get this straight, says fellow Postie Terence Corcoran, instead "of the old nebulous net benefit test for foreign investment, Canada will have a new nebulous net benefit test"? That certainly improves nothing. Completely "arbitrary and ambiguous" scoff-agrees Tim Harper in the Star. Yeah, adds the Globe and Mail, is anyone cheered by the thought that Harper and friends "appear to be on the verge of giving themselves arbitrary new powers" to further arbitrate all this arbitrary arbitrage?

The Globeos worry all this arbitrariness is a sign that our PM is taking a "page out of Beijing's playbook," but that might be going a bit far.

I mean, at least the Chinese have a philosophy.

Loading Slideshow...
  • The Target

    Nexen is a global oil and gas company that produced 207,000 barrels of oil equivalent per day at the end of 2011. In this April 25, 2012 photo, Nexen chief executive Kevin Reinhart addresses the company's annual meeting in Calgary. <em>With files from The Canadian Press</em>

  • Areas Of Operation

    Only about 30 per cent of Nexen's production comes from its Canadian operations, with the rest coming from offshore platforms in the North Sea, Gulf of Mexico and West Africa.

  • The Buyer

    CNOOC Ltd. is China's largest offshore oil and gas producer and is one of the largest oil and gas exploration and production companies in the world. At the end of 2011, it had 909,000 barrels of oil equivalent per day of production. Its Beijing-based parent, China National Offshore Oil Co., operates directly under the State-owned Assets Supervision and Administration Commission of the State Council of the People's Republic of China. CNOOC Ltd. shares trade on Hong Kong and New York stock exchanges.

  • The Offer

    On July 23, Nexen announced it had accepted CNOOC Ltd.'s all-cash offer of $27.50 per share, worth $15.1 billion. In a circular to shareholders a month later, Nexen revealed it had rejected two earlier CNOOC offers as too low.

  • The Premium

    61 per cent over Nexen's closing share price on the trading day before the deal.

  • Partnership

    CNOOC and Nexen had a relationship well before they announced their deal. In 2011, CNOOC acquired Opti Canada Inc., Nexen's beleaguered partner in the Long Lake oilsands project and the two have been working together on that project since. Later in 2011, CNOOC and Nexen formed a joint venture in the Gulf of Mexico. Around the same time, Nexen also agreed to sell a 40 per cent interest in some of its northeastern B.C. shale natural gas lands to a Japanese-led consortium.

  • The Target

    Progress Energy Resources Corp. (TSX:PRQ) is a mid-sized natural gas producer with daily production of about 50,000 barrels of oil equivalent per day.

  • Areas Of Operation

    Progress is the largest landholder in the Montney shale in northwestern Alberta and northeastern B.C. It is also active in Alberta's Deep Basin.

  • The Buyer

    Petroliam Nasional Bhd, or Petronas, is wholly owned by the government of Malaysia. It has assets and interests in more than 30 countries and is heavily involved in the liquefied natural gas, or LNG, business.

  • The Offer

    Progress announced in late June it had agreed to Petronas' $20.45-per-share takeover offer. A month later, the Malaysian state-owned company sweetened its offer to $22 per share in order to trump a rival bid, bringing the deal's total value to $6 billion.

  • The Premium

    The sweetened offer is worth double what Progress shares traded at the day before the initial takeover deal was announced.

  • Partnership History

    In mid-2011, Progress and Petronas formed a 50-50 partnership to jointly develop the some of the Canadian company's land in the north Montney. The two companies are also partnering on a liquefied natural gas terminal near Prince Rupert, B.C., that will be 60 per cent bigger if the takeover deal

 

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