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OPINION | Federal carbon tax and Teck Frontier: Jason Kenney wins one, loses another


You win one, you lose one.

But for Premier Jason Kenney, winning one and losing one doesn’t add up to the status quo.

On Sunday, Kenney lost the $20-billion Teck Resources’ Frontier oil sands project proposed for northern Alberta.

On Monday, he won a legal challenge against the federal government’s carbon price, imposed on Alberta last month.

But in this case the two don’t counterbalance each other. It’s a see-saw with an elephant on one end and a mouse on the other.

If Kenney had wanted to choose one fight to win and one to lose, he would have swapped them around.

He’s certainly happy enough the Alberta Court of Appeal’s 4-1 decision found the federal government’s carbon tax was an intrusion on provincial jurisdiction. However, the carbon tax will remain in place as the legal battle continues.

That fight is already bound for the Supreme Court because the governments of both Ontario and Saskatchewan, after losing their own legal fights, launched appeals. Based on the fact that senior courts in two provinces have already upheld the federal tax, Canada’s highest court could yet disappoint Kenney.

The Teck decision, though, is final.

On Sunday, company president Don Lindsay issued a letter saying he was cancelling the mega-project that was projected to create 7,000 construction jobs and 2,500 permanent jobs, as well as pour $70 billion worth of taxes into government treasuries over 40 years.

Kenney warned Prime Minister Justin Trudeau a few weeks ago that cancelling the Frontier mine would be disastrous for the Alberta economy. But back then Kenney, and everybody else, was thinking the fate of Teck’s project lay with the federal cabinet approving or rejecting the project by the end of February.

Teck decision ‘disastrous’ for Kenney

Nobody was talking about Teck throwing its own project off a cliff.

If this is a disaster for Alberta’s economy, it’s just as disastrous for Kenney politically.

After campaigning on a promise of jobs, but watching the economy continue to sputter, Kenney is desperate to show Albertans some good financial news.

But who to blame for Teck’s bad news?

Ah, that’s become a political football.

Take a moment to read the carefully worded letter from Teck abruptly cancelling the Frontier oil sands proposal and tell me what you see.

It is the Rorschach inkblot test of Alberta politics.

If you’re Kenney, you see in the wording the insidious spectre of Trudeau deliberately knifing the $20-billion project in the back.

“Weeks of federal indecision on the regulatory approval process and inaction in the face of illegal blockades have created more uncertainty for investors looking at Canada,” Kenney said. “We did our part, but the federal government’s inability to convey a clear or unified position let us, and Teck, down.”

However, if you’re Alberta NDP Leader Rachel Notley, you see the project being beaten to death by the harmful policies of the Kenney government.

“The heated rhetoric and constant conflict generated by Jason Kenney and the UCP is the primary reason for withdrawal of Teck’s application,” said Notley. “That project has been spiked and the premier himself is the one to blame.”

In fact, the letter from Teck president Don Lindsay doesn’t overtly blame Trudeau or Kenney. It is written so carefully there is a whiff of a Greek oracle about it. Parse it closely enough and you can make the statement say just about anything.

But parse it down to single words and one stands out: “climate.”

Lindsay mentions the word eight times, including five times in the term “climate change,” as in, “global capital markets are changing rapidly and investors and customers are increasingly looking for jurisdictions to have a framework in place that reconciles resource development and climate change.”

Politicians blaming each other

As Lindsay points out, that framework is not in place. And so we have politicians blaming each other. Conservatives blaming the Liberals for not doing enough to promote resource development and the NDP blaming Conservatives for not doing enough to combat man-made climate change. It is the merry-go-round from hell.

It’s not about to stop anytime soon.

Of course, there is a third party to blame: a climate-changed world trying to be less reliant on fossil fuels.

Lindsay said weeks ago that even if the federal government approved the Frontier project, it might not go ahead. Teck needed three conditions to continue: the completion of the Trans Mountain pipeline expansion, a higher price for oil and a partner.

Trans Mountain’s twinning is going ahead but the price of oil would have to be about double what it is now. And there was no guarantee Teck could find a partner, especially when we hear stories about nervous investors avoiding oil stocks in general and the oilsands in particular.

Teck’s Frontier project, first envisioned a decade ago, might not have made economic sense a decade from now.

Where does that leave us in Alberta?

With a premier who is as combative as ever, predictably blaming Ottawa for Alberta’s troubles, and warning of a rise in western alienation even as he stokes the fires himself.

A new twist

But a new twist on Monday: Asked if the Alberta government would consider buying Teck’s Frontier lease in the oilsands, Kenney responded, “We’re ruling nothing out.”

Really? The hands off, free-enterprise United Conservative government investing directly into the oilsands?

If nothing else, this reveals the depth of Kenney’s desperation to show he can create jobs and kick-start the economy.

He may have won a legal battle Monday but he lost the war over Teck.

And Kenney will find new wars to fight starting Tuesday when the spring sitting of the Alberta legislature opens with a throne speech and moves quickly into what promises to be a controversial provincial budget on Thursday.

This column is an opinion. For more information about our commentary section, please read this editor’s blog and our FAQ.



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