With almost nothing left to lose, Albertans rise up against Ottawa\u2019s empty pipeline promises<\/a><\/li>\n<\/ul>\nInstead, Aspen, expected to cost $2 billion for each 75,000 barrels a day phase, has been under review by the Alberta Energy Regulator for four and a half years, leaving the company with no new major projects to work on.<\/p>\n
\u201cI have lived and worked in a lot of places, and four and a half years to get a project that has strong economics, pace-setting environmental performance, is inordinately long,\u201d Kruger said to reporters after addressing the company\u2019s annual shareholders meeting in Calgary.<\/p>\n
\u201cWe have provided answers to every question that (was) asked,\u201d Kruger said. \u201cWe engaged with whomever we needed to engage. This is an illustration of the long, costly, uncertain regulatory environment that the energy industry faces in this country right now.\u201d<\/p>\n
Imperial is 70 per cent owned by Exxon Mobil Corp., one of the few international oil majors still committed to the oilsands after major competitors pulled out to invest in friendlier jurisdictions.<\/p>\n
Multiple executives have criticized expanding and uncertain regulatory processes for stifling the investment.<\/p>\n
The head of TransCanada Corp. said there was no way his company could revive the $15-billion Energy East pipeline. TransCanada is expanding in the U.S. and Mexico.<\/p>\n
\u201cI can\u2019t think of a better opportunity for this nation than Energy East. Unfortunately, the hurdles to get to the finish line were insurmountable and watching what\u2019s happening right now, on the West Coast, it\u2019s hard to imagine how we could resurrect that project,\u201d TransCanada president and CEO Russ Girling said at the company\u2019s annual meeting on Friday, referring to the pipeline fight over competitor Kinder Morgan Canada\u2019s Trans Mountain expansion.<\/p>\n
\u201cI never say never to anything but it\u2019s hard to see how the stars and the moon could align so that could be a viable opportunity for us in the near term,\u201d Girling said, confirming that Energy East is cancelled rather than just suspended.<\/p>\n
Imperial Oil is a shipper on Trans Mountain and has signed up for space in the proposed expansion, which the British Columbia government wants to derail.<\/p>\n
Kruger said the Aspen project may not go ahead even if it receives regulatory approval if it can\u2019t transport the oil to consumers.<\/p>\n
\u201cFor the industry to have confidence to materially invest in growth, we are going to need new market access,\u201d he said. \u201cIn the absence of confidence of that \u2026 it will be a big part of our deliberations and consideration on any new expansion.\u201d<\/p>\n
Already, the company had to curtail production at its Kearl oilsands project by 12,000 barrels a day in the first quarter because it had no place to put it, Kruger said.<\/p>\n
Lack of transportation capacity has meant Canadian oil producers have not participated in strengthening global oil markets, he said.<\/p>\n
In first quarter results announced Friday, Imperial said net income grew to $516 million, from $333 million in the same period a year ago; production decreased to 370,000 barrels a day from 378,000 barrels a day; and bitumen sold for $35.61 a barrel on average, 60 cents less than in the same period last year, while synthetic crude was sold for $77.26 a barrel, $9.47 a barrel higher than a year ago.<\/p>\n
Kruger said Imperial is now focused on boosting the performance of its existing asset base and giving back to shareholders, including raising its dividend by nearly 20 per cent.<\/p>\n
Financial Post, with files from Geoffrey Morgan<\/em><\/p>\n\u2022 Email: ccattaneo@nationalpost.com<\/a> | Twitter: