Oil well liability became a big issue in Alberta politics this month when rural municipal politicians raised giant red flags about the estimated $173 million in unpaid municipal taxes as a result of some oil and gas companies nearing insolvency and many more companies just believing paying taxes is voluntary.
Tina Faiz and Regan Boychuk joined Dave Cournoyer on this episode of the Daveberta Podcast to discuss the growing issue of oil well liability, and the political and policy repercussions created in its wake.
Tina Faiz is a communications consultant and political strategist based in Edmonton and Regan Boychuk is the lead researcher and oilfield liability expert with the Alberta Liabilities Disclosure Project.
The Daveberta Podcast is a member of the Alberta Podcast Network, powered by ATB. The Alberta Podcast Network includes more than 30 great made-in-Alberta podcasts.
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Daveberta Podcast host Dave Cournoyer teamed up with AlbertaPolitics.ca writer David Climenhaga at the annual Parkland Institute Conference at the University of Alberta last weekend to share what we know and what we speculate might happen with the Canadian Energy Centre Ltd. (a.k.a. the War Room) and the Public Inquiry into anti-Alberta Energy Campaigns.
Thank you to our producer Adam Rozenhart for doing a great job improving the audio quality of this episode (it was recorded on Dave’s iPhone).
The Daveberta Podcast is a member of the Alberta Podcast Network, powered by ATB. The Alberta Podcast Network includes more than 30 great made-in-Alberta podcasts.
You can listen and subscribe to the Daveberta Podcast on Apple Podcasts, Google Play, Spotify, Stitcher, or wherever you find podcasts online. We always love to feedback from our listeners, so let us know what you think of this episode and leave a review where you download.
Send us your feedback, or ask us any questions you have for our next episode. You contact us on Twitter, Instagram, the Daveberta Facebook page, or you can email us at podcast@daveberta.ca.
Thanks for listening!
(Photo: David Climenhaga and Dave Cournoyer, source: Dave Cournoyer)
Premier Jason Kenney (at the podium) announces the appointment of Steve Allan (right) as Commissioner of the Public Inquiry into Anti-Alberta Energy Campaigns.Also pictured are then-Justice Minister Doug Schweitzer and Energy Minister Sonya Savage.
It was not a banner week for Alberta’s public inquiry into anti-Alberta energy campaigns.
Allan’s son is a partner at Dentons’ Calgary office and Justice Minister Doug Schweitzer was a lawyer at that firm before he was elected to the Legislative Assembly. Schweitzer said he severed his connections to the firm earlier this year, but Allan’s son’s employment status at the firm raises some serious questions about conflict of interest.
The inquiry’s business is shrouded in secrecy and it was designed by the government to be exempt from Freedom of Information requests that would allow a certain degree of transparency. For example, the inquiry website states that Allan intended to travel to Vancouver and Washington, DC in September 2019, and the North Coast of BC and Toronto in October 2019, but because the inquiry is exempt from FOIP requests, it is unclear who he met with during his travels.
But that has not stopped the media from digging, and the leaks from leaking.
Allen is being paid $291,000 for his one-year contract, according to information gathered by Alberta Today’s Allison Smith, and will be paid up to $800 per day to provide testimony following the completion of the inquiry’s investigation. The Edmonton Journal reported that the inquiry is hiring a part-time executive director for $108,123.
CBC also reported that Allan donated $1,000 Schweitzer’s campaign for the UCP leadership in 2017, which raises questions about the nature of his appointment as the inquiry’s commissioner.
Much of the basis of the inquiry’s investigation, that foreign-funded organizations like the Rockefeller Brothers Fund are responsible for secretly financing anti-pipeline and anti-oil groups in Canada, appears to have been discredited by investigative research done by the National Observer’s Sandy Garossino.
Garossino analyzed data on international charitable granting and found that international foundations, mostly American, have granted around $2 billion to Canadian groups over the last decade, but only 2 per cent of those funds (around $40 million) has gone towards pipeline opposition.
Of that $2 billion total in international funds, about 33 per cent came from the United States government. The second largest funder is the Bill and Melinda Gates Foundation, contributed $537 million. The Rockefeller Brothers Fund environmental grants, which have been demonized in Alberta’s political and media circles, amounted to “just two dollars per thousand in Canadian foreign grants.”
The Foundation’s submission included a report showing that funding from outside Canada represented 0.85% of total funding received by Canadian charities, and 0.26% of total funding received by charities based in Alberta.
The Foundation harshly criticized the rhetoric, fear-mongering, and false statements used to justify the inquiry and the government orders authorizing its creation.
“To even imply that support of the energy industry or even agreement with government could become a criterion for determining whether an organization receives funding comes, we suggest, dangerously close to government direction of speech and thought. Leaving aside the legality of such an action, one could suggest that such a course of action would be contrary to the very principles of democracy.”
The inquiry is due to submit a final report to the Alberta government no later than July 2, 2020. In terms of the public inquiry’s credibility crisis and the damage it and the secrecy surrounding it could cause for our province’s reputation, Albertans might eventually need a public inquiry into the Public Inquiry into anti-Alberta Energy Campaigns.
International banks continue to divest from fossil fuels
While Steve Allan’s public inquiry is focused on anti-Alberta energy campaigns, the biggest threat to the oil and gas industry in Alberta might be the free market.
Sweden’s central bank announced this week that it no longer hold bonds issued by local authorities in Canada and Australia with high carbon-dioxide emissions. Bloomberg reported that the Riksbank said it had sold its holdings of securities from Alberta, where greenhouse gas emissions per capita are three times higher than in Ontario and Quebec.
Premier Kenney’s principal secretary, David Knight-Legg, faced criticism this week after it was revealed that the senior political staffer stayed in upscale five-star hotels while travelling to London on Alberta government business. According to financial disclosures, Knight-Legg spent more than $45,000 on travel, including four trips to the British capital since the UCP formed government in April 2019.
Meanwhile, the private corporation created by the Alberta government to fight defamation of the oil and gas sector has been running on silent. Not a peep has been heard from the $30 million War Room, now renamed the Canadian Energy Centre, since former reporter and defeated UCP candidate Tom Olsen was appointed as its managing director last month.
The War Room is also exempt from Freedom of Information requests.
Deep cuts to the provincial budget are resulting in the cancellation of public services and job layoffs across the province, and the fallout from the federal election continues to dominate the political discussion. And crisis – organized crisis – reigns, as Premier Jason Kenney’s United Conservative Party government dramatically shifts the political narrative on an almost daily basis.
Preston Manning
But things got really weird last week when elected councillors of the County of Wheatland, a 8,700 person rural municipality east of Calgary, voted for a resolution calling for a possible Alberta independence vote. The councillor who introduced the motion is Jason Wilson, who according to his online biography also sits on the board of the local UCP association.
Yesterday, Kenney stood at the podium at the now one-day Manning Networking Conference in Red Deer to announce the creation of a “Fair Deal” panel that will look at ways to give the province more autonomy.
While some of the frustration felt by Albertans is legitimate, regional and partisan grievances are deeply intertwined in this province. With the UCP essentially operating as a provincial-wing of the federal Conservative Party, it is hard to believe that this panel would exist if Scheer had not snatched defeat from the jaws of victory on October 21.
The panel will be given a $650,000 budget to hold seven town hall meetings to consult with Albertans on a prescribed series of issues that have been bees in Conservative partisans’ bonnets for decades, including:
withdrawing from the Canada Pension Plan and creating an Alberta Pension Plan (something that was hinted last week and could have a big impact on the migration of interprovincial labour to Alberta),
replacing the Canada Revenue Agency by establishing a provincial revenue agency,
ending contracts with the RCMP and creating a provincial police force (the RCMP are currently investigating allegations of fraud in the UCP’s 2017 leadership contest),
opting out of federal programs like pharmacare,
forming an office of a Chief Firearms Officer (a Wildrose Party policy), and
creating an Alberta Constitution.
The panel’s mandate letter talks a lot about emulating Quebec, including implementing a rule that municipalities and school boards require the approval of the provincial government before they can enter into agreements with the federal government. This could be used by the Kenney government to cut off potential cooperation between municipalities and the federal government on projects like affordable housing, public infrastructure and climate change initiatives.
The panel and its town hall meetings are both a relief valve and a steering wheel meant to allow Albertans to vent their frustrations while allowing Kenney to attempt to keep ahead of the crowd. Or at least that’s probably the plan.
Ralph Klein
Kenney frequently boasts about the size of his electoral mandate, so it is notable that none of the autonomy polices to be considered by the panel were included in the UCP’s incredibly thorough election platform just six months ago.
The MLA committee was created in the wake of the infamous 2001 Firewall Letter, signed by right-wing luminaries Ted Morton, Tom Flanagan, Rainer Knopff, Andy Crooks, Ken Boessenkool, and future prime minster Stephen Harper, and in response to small but loud fringe groups like the Alberta Independence Party and the Separation Party of Alberta.
And, like many of the initiatives started in the final few years of Klein’s tenure as premier, it was a meant to create a distraction from what had largely become a rudderless government.
Ian McClelland
The mandate letter of the MLA committee was filled with much more flowery and hopeful language than the doom-and-gloom fear of separatism included in the mandate letter of Kenney’s panel. But the real mandate of the MLA committee was to travel the province to gauge support for the Firewall manifesto – a similar mandate of Kenney’s panel.
The MLA Committee on Strengthening Alberta’s Role in Confederation held 12 public hearings between January and March 2004 and here is what they recommended:
Pension Plan: “The Committee believes that withdrawing from the CPP and creating a separate Alberta pension plan is not in the best interests of Albertans. That is not to say that the CPP should not be improved for Albertans and all Canadians. The Committee further recommendsthat Alberta develop and advocate further CPP reforms that will end the intergenerational inequity, and move the CPP to a fully-funded foundation.” (Page 19)
Tax Collection: “Collecting our own personal income taxes would be a costly venture. One analysis suggests that set-up costs would be $30-40 million and that annual administrative costs could be between $70 and $160 million (including the costs of an additional 1,000-2,000 full time positions that might be required).By comparison, the administrative fee paid by Alberta under the TCA is less than $5 million annually. The Committee is also concerned that individual Albertans and businesses in the province would incur higher out-of-pocket costs in complying with two separate tax systems. This consideration alone makes the idea impractical. The Committee recommends that the Government of Alberta reach a new Tax Collection Agreement with the federal government that addresses Alberta’s concerns and provides increased tax policy flexibility.” (Page 21)
Mary Anne Jablonski
Police Force: “The Committee recommends that the Government of Alberta commission a detailed study of policing alternatives to the RCMP in advance of the 2007 cost review. This analysis should include a careful examination of costs, efficiencies, and levels of service. … The Committee further recommends that appropriate municipal stakeholders be consulted in the cost review negotiations in 2007, and that consideration be given to inclusion of such stakeholders on the Alberta negotiating team.” (Page 25)
Senate: “The Committee recommends that the Government of Alberta, through the Council of the Federation, encourage the Premiers to consider a process that would see the Prime Minister fill Senate vacancies from lists of provincial nominees. In Alberta’s case, the list should be generated by a Senatorial election.” (Page 29)
Intergovernmental Relations: “The Committee further recommends that the Government of Alberta re-establish an office in Ottawa. Close proximity to, and face-to-face contact with, federal decision-makers would improve relations between our governments and would help ensure Alberta interests are accurately and efficiently conveyed and addressed.” (Page 58)
Our Future: “The Committee also recommends that the Government of Alberta work towards fixing the underlying structural problems of our Canadian institutions that feed the flames of western alienation. The Committee further recommends that the Government of Alberta establish a fund for use in pursuing those legal challenges deemed to be necessary and desirable for safeguarding Alberta’s Constitutional jurisdiction.” (Page 59)
The MLA committee and its final report rejected the Firewall manifesto and was quickly forgotten after Paul Martin’s Liberals lost their majority in June 2004 and Klein’s PCs had their knuckles rapped in November 2004. But unlike Klein’s committee, which resulted in some fairly moderate and milquetoast recommendations, many of the panel members appointed by Kenney yesterday and the political environment they exist in are much more ideologically driven and politically divided.
This weird ride doesn’t look like it’s going to end anytime soon. There’s more crisis ahead.
Alberta to reopen office in Ottawa, again
In his speech to the Manning Centre, Kenney announced that the Alberta government will open offices in Ottawa, Quebec, and British Columbia. It is unusual and unclear why the Alberta government would need offices in other provincial capitals or in Ottawa, where Albertans just elected 34 Members of Parliament to represent their interests. But an office in the federal capital is not unprecedented.
The Alberta government opened an office in Ottawa in 1939. The Ottawa office was closed in 1996 and its last executive director, Gordon Olsen (brother of War Room CEO Tom Olsen), relocated to Calgary. A government review conducted in 2000 concluded that technology allows people to research information just as easily without a full-time office in Ottawa.
In 2004, Klein publicly mused about opening an Alberta government-funded office in Ottawa for the province’s elected Senate nominees, but the unpopular idea died quickly.
Premier Alison Redford reopened the office in 2013 and Calgary energy lawyer Alan Ross was hired as Alberta’s representative. Premier Jim Prentice closed the office again in 2015.
Canadian Energy Centre CEO Tom Olsen and Alberta Premier Jason Kenney. (Source: Facebook)
The Alberta government’s much talked about energy war room now has its General. Energy Minister Sonya Savage announced yesterday that Tom Olsen has been hired as the managing director of the newly incorporated Canadian Energy Centre. The $30-million publicly funded private corporation is part of the UCP’s “fight back strategy” to counter claims made by critics of the oil and gas industry that Premier Jason Kenney said will target politicians, media and other opinion leaders, and could include satellite offices overseas.
Joe Ceci
Olsen was most recently the United Conservative Party candidate in the downtown Calgary-Buffalo riding in the 2019 provincial election, where he finished 9 per cent short of unseating former New Democratic Party finance minister Joe Ceci. But despite his recent electoral loss, Olsen has been a fixture of Conservative politics in Alberta for more than a decade.
After years as a columnist and reporter for the large daily newspapers in Calgary and Edmonton, Olsen jumped into politics when he was hired as Premier Ed Stelmach’s spokesperson in 2007. (Olsen’s brother, Gordon Olsen, worked in senior roles in the Premier’s Office while Ralph Klein occupied the office).
While some Albertans will remember Olsen for his role in the Northumberland beach photos fiasco, he also oversaw the launch of the first version of the war room.
In 2008, the Alberta government launched a website called “For the Record” that was dedicated to correcting what the government determined was incomplete or incorrect information in the media. “It’s not a forum to argue philosophy and spin. . . it’s not debating the rightness or wrongness of a particular issue. It’s about factual information,”Olsen told the Calgary Herald in December 2008. “I don’t see it as government policing journalists.”
The Alberta Government’s short-lived “For the Record” webpage.
It was the government policing journalists, and it did not last very long. The government website posted six corrections to news stories from various media outlets between November 2008 and December 2010. The website briefly became a source of controversy when Olsen insisted the Globe & Mail be referred to as the Toronto Globe & Mail. The website was later edited to drop Toronto from the newspaper’s name.
Following a wholesale purge of Stelmach’s senior communications staff, Olsen was whisked off to Vancouver to handle the Alberta government’s public relations during the 2010 Winter Olympics, which included the renting of the luxury Rocky Mountaineer train and the distribution of free iPads to journalists and VIPs.
Sonya Savage
Olsen later worked as a lobbyist for groups including the Calgary Residential Rental Association, Greyhound and the national group representing Pay Day Loan companies. He found himself back in the Progressive Conservative Party fold when he became Vice-President of Communications during Jim Prentice‘s brief time as party leader.
Savage, a former pipeline lobbyist and now a member of the war room board of directors along with Justice Minister Doug Schweitzer and Environment and Parks Minister Jason Nixon, said this week that the war room will include a rapid response centre, an energy literacy unit and a data research unit. Former Postmedia columnist Claudia Cattaneo was hired in August 2019 by the government to write the Energy War Room Strategic plan.
In an interview with the Postmedia-owned Financial Post, Postmedia President and CEO Andrew MacLeod said that the lobby effort was part the company’s effort to find new revenue streams and that it had no relationship to editorial decision-making (meanwhile, the front cover of the Postmedia-owned National Post today featured a paid political advertisement attacking Prime Minister Justin Trudeau).
Andrew MacLeod
The Canadian Association of Petroleum Producers, a lobby group that represents many of Canada’s oil and gas companies, is also registered to lobby Alberta MLAs, the Minister of Energy and the Premier’s Office to share and advise on best practices for the war room to counter misinformation.
Postmedia’s past relationship with CAPP is no secret, but these group’s business relationships with the war room could be.
As CBC’s Michelle Bellefontaine reported today, as a private corporation the Canadian Energy Centre will be exempt from freedom of information requests, meaning that Albertans might not ever know how much of the $30 million is paid to Postmedia, CAPP or whichever UCP-connected PR firms are hired to work for the publicly-funded private war room.
Regardless of which PR companies or Toronto-based newspaper company gets hired, Olsen will have his job cut out for him. The first order of business for the new Canadian Energy Centre might be playing defence for the Alberta government’s $2.5 million public inquiry into anti-oil campaigns – an effort that has been criticized as a witch-hunt by groups like EcoJustice and the venerable Amnesty International.
While it may be easy for Kenney to dismiss NGOs and suggest that the 4,000 Albertans participating in the climate strike protest outside the Legislature were communist sympathizers, Olsen’s war room will have a harder time dismissing its greatest opponent – the free market.
Many major international oil and gas corporations have withdrawn their investments in Canada’s oilsands over the past five years, and the UCP’s decision to scale back the Alberta government’s climate change commitments certainly will not help how our province is perceived internationally.
Conservatives howled loudly this week as a major Norwegian pension fund withdrew investments in four Alberta-based oilsands companies. The move was described by UCP supporters online as hypocritical, as Norway continues to make investments in its own off-shore oil and gas platforms. The move may have been hypocritical, but those are the types of decisions that countries like Norway can make when they have $1.1 trillion saved in the bank (something for Albertans to think about when they consider how much past governments have squandered our wealth).
Olsen’s biggest challenge might be to prove that the war room is more than a $30-million public relations subsidy to Alberta’s oil and gas companies.
Public attitudes toward fossil fuels and climate change are shifting dramatically, and Alberta risks becoming increasingly isolated on energy and climate issues on the national and international stage. Judging from the Alberta government’s numerous high-profile efforts over the past two decades to correct what it saw as misinformation about the oilsands and fight environmental advocates outside the province, the war room might be an example of the UCP preparing to fight the last war.
A short history of Alberta government advertising campaigns and initiatives aimed at critics of oil and gas companies (I am sure I have missed a few):
2002: the Alberta government announced and later scrapped plans for an anti-Kyoto Accord advertising campaign in Ontario after focus group testing proved the messaging was unpopular among Torontonians.
2008: the Alberta government launched a public relations campaign targeting critics of the oilsands outside of Alberta, which included a 20-page glossy brochure entitled Alberta’s Oil Sands: Balance. Opportunity. This campaign included a North America and European speaking tour by the Premier.
2010: the Alberta government rolled out a slick $25-million “Tell It Like It Is” oilsands promotional campaign that included advertisements in London’s Piccadilly Circus and New York City’s Times Square. The multimedia blitz includes CDs and DVDs about “Alberta’s Clean Energy Future” and “A conversation on oilsands and the environment” – which features commentary from provincial experts.
2012: the Alberta government announced it was spending $77,000 on a pro-Keystone XL Pipeline advertising campaign during the Premier’s visit to Washington DC and hired lobbyists to directly lobby US officials.
2012: the federal Conservative government assigned Canadian diplomats to lobby Fortune 500 companies in the U.S. in order to counter campaigns launched by an environmental advocacy groups targeting the oilsands.
2013: the federal Conservative government launched a advertising campaign directed at American politicians ahead of Prime Minister Stephen Harper’s trip to the United States. The ad campaign described Canada as a “world environmental leader” on oil and gas development.
2018: the Alberta government spent more than $23 million promoting its KeepCanadaWorking advertising campaign in support of the expansion of the Trans Mountain PIpeline from Alberta to British Columbia.
