Cooling it

Journal of Canadian Studies/ Revue d'etudes canadiennes Editor DENIS SMITH Redacteur Associate Editor RALPH HEINTZMAN Redacteur adjoint Editorial Board MARGARET LAURENCE Comite de redaction JACQUES MONET W. L. MORTON W. F. W. NEVILLE GORDON ROPER DONALD V. SMILEY PHILIP STRATFORD T. H. B. SYMONS W. E. TAYLOR CLARA THOMAS JOHN WADLAND MELVILLE H. WATKINS ALAN WILSON Cooling it As winter settles in, some of the frenzy of the autumn seems, fortunately, to have passed out of the debate on energy policy. It may be too much to hope that discussion will now proceed calmly and reasonably with eyes set firmly on the long-term - the political situation hardly allows that measure of dispassion - but at least we should expect the next round of discussion to occur with greater deliberation than the first round demonstrated. The initial positions of the protagonists have now been established, and the more intricate bargaining and reassessment should now begin. The first public occasion for that will be the federal-provincial conference in late January, 1974. In the flurry of statements and counterJournal of Canadian Studies statements of the autumn, it was sometimes difficult to detect any coherence; although by the end of the year it was easier to see consistency in the arguments of Alberta and Saskatchewan than in those of Ottawa. The Alberta case (which has been in formation since before the election of the Lougheed government) is that the province must use its precious leverage quickly, as the major Canadian supplier of oil and gas, to broaden the industrial base of the province , increase the province's return on production and promote the development of tar sands extraction, all as means of strengthening Alberta's long-run prosperity. This has involved the Lougheed govetnment's attempt to establish a two-price system for Alberta 1 gas, its support for a free-floating oil price based on the American market value, its revision of royalty agreements, its effort to take control of oil marketing, and its cooperation with the industry in the Syncrude oil sands development. In the context of the province's former laissez-faire attitude to resource development, and of the west's historic disadvantages within the national system, Alberta's new alertness to its interests should not be dismissed contemptuously as "blackmail" in the manner of some Ottawa commentators. The exercise of its bargaining power, within certain broad limits, is an entirely legitimate exercise within the Canadian federal system. There is no real indication, yet, that Alberta has ventured beyond the bounds of reasonable give-andtake . The more significant question about Alberta's policy is whether the province has taken sufficient distance from the international oil companies in pursuing its vision of the public interest. So far, the Lougheed government seems to have struck a balance with the oil companies which rewards their acquiescence in its own search for revenue and an industrial base by much increased profits and a privileged role in the oil sands project. That may be the diplomatic path of least resistance for Lougheed and company; but it is a dubious service to Albertans and Canadians, whose interest is to preserve the resources for long-term Canadian use and to assure that the public purse receives the maximum share of economic rent accruing from non-renewable resource sales. The Syncrude arrangement, with its neglect of royalty payments, its minority shareholding for the Alberta government, and its exemption from normal oil export limitations, appears to be the most careless concession to the companies, to the developmental ethic, and to the insatiable demands of the American market. The time when Canada could take such carelessness for granted has long passed. Allan Blakeney of Saskatchewan, in con2 trast, has begun to enunciate a policy for that province which asserts the local (and the western) interest forthrightly, but which also confronts the special privileges of the international oil companies. His proposals, in potential, for public control of oil and gas resources and pricing, come closer to fulfillment of the public interest than do Peter Lougheed's. By acting as he has, Mr. Blakeney may give the Alberta government some latitude to move further in that direction too. Ottawa has more...