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Konrad Yakabuski (Fernando Morales/The Globe and Mail)

Konrad Yakabuski

(Fernando Morales/The Globe and Mail)

KONRAD YAKABUSKI

Will Quebec stray from its ‘virtuous’ energy path? Add to ...

For years, Quebec’s leaders have constructed a politically profitable narrative about the province’s transition toward a post-carbon economy. They have sold voters on the notion of clean hydro and wind power turning the province into an oasis of electric cars and trains.

According to this narrative, Quebec is on the leading edge of clean tech while most of North America remains wedded to a fossil fuels mentality. Quebeckers may not have Alberta’s oil riches, but they can sleep soundly at night knowing they’re on a more virtuous energy path.

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This progressive peace has been shattered by the suddenly real prospect of oil and gas development in the province. Black gold has Quebeckers parting like the Red Sea.

There are those who see the province’s newly recoverable hydrocarbon deposits as a windfall that will enable Quebec to tame its debt. They say the province has a moral obligation to exploit these resources to lessen the tax burden on future generations. And they fear a backlash from the rest of Canada if Quebec sits on its resources while continuing to draw equalization payments from Ottawa.

Those opposed to extracting Quebec’s shale oil and gas cite a litany of potential drawbacks. Groundwater pollution from hydraulic fracturing (or fracking) in the populated St. Lawrence Valley is a top concern. Environmental destruction and disruption of the deer population on the pristine Anticosti Island is another. Mostly, the opponents argue that oil and gas development would be a step backward. After all the progress the province has made toward a post-carbon economy, why get involved in the retrograde job of raping the planet now?

In the middle of this quagmire is Parti Québécois Premier Pauline Marois. With a slim minority of seats in the National Assembly, she needs to increase PQ support by snatching suburban voters away from the Coalition Avenir Québec and the Liberals. Both of the PQ’s leading rivals are pro-development (at least in speeches), and Ms. Marois can’t stray too far to the left. Yet, every step she takes toward the centre grates on her caucus and the PQ’s progressive base.

And at barely 30 per cent in the polls, the PQ can’t afford to offend any more of its base. Since last year’s election, the party has lost ground to the left-wing Québec Solidaire. The latter warns the Marois government that it has no mandate to greenlight oil and gas development in the province, or import dirty oil from Alberta to supply refineries in Montreal and Quebec City.

Predictably, Ms. Marois has punted. She has commissioned the province’s environmental review board to undertake an extensive examination of fracking, an exercise likely to yield few new insights. Fracking, like almost anything in life, carries risks. By all accounts, they are manageable. But France has a moratorium on fracking, so, in PQ-think, it must be a good idea. The development of Quebec’s shale gas resources has been deferred sine die.

Ms. Marois has shown more openness toward developing the shale oil deposits on Anticosti Island. But she has left the trio of junior mining companies with exploration rights on Anticosti in the dark about potential regulations and royalties. A NIMBY protest on the Gaspé Peninsula, meanwhile, threatens to derail oil development in a region with 15 per cent unemployment.

Quebec will never be Alberta. But it could be a lot better off than it is now. A new study by the Canadian Energy Research Institute estimates that the extraction of shale gas in the St. Lawrence Valley could add as much as $112-billion to the Canadian economy over 25 years, half of it in Quebec. While gas prices are low now, they’re expected to rise substantially in coming years. And Quebec’s gas would fetch a premium in the typically higher-priced Boston market.

The estimated two billion barrels of recoverable oil on Anticosti Island would add tens of billions more to the provincial economy. The development of the Gaspé deposits and the Old Harry prospect in the Gulf of St. Lawrence would be like gravy for a province used to scraping by.

Oil and gas revenues would lead to a decline in equalization, of which Quebec is set to receive $7.4-billion this year. So, Ottawa should ensure that the equalization formula – which is up for review next year – does not remain an incentive for Quebec to leave its resources in the ground.

 

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