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Ontario Premier Dalton McGuinty speaks at the ROMA/OGRA Conference in Toronto, on Monday, Feb. 27, 2012.

Nathan Denette/THE CANADIAN PRESS/Nathan Denette/THE CANADIAN PRESS

Dalton McGuinty concedes he never should have blamed his province's economic woes on the "petro dollar," marking a rare climbdown for a political leader not known for speaking off the cuff. Alison Redford insists he still owes her an apology, rebuffing him once again in favour of a tried-and-true Alberta strategy of picking a fight with Ontario.

The he-said, she-said exchange between the two provincial leaders was supposed to end on Wednesday morning, when Mr. McGuinty, Premier of Ontario, blamed the perils of working in "real time" for making a comment he now regrets – that he would prefer to have a low Canadian dollar instead of a booming oil-and-gas sector in Western Canada.

Instead, Ms. Redford, the Alberta Premier, suggested Mr. McGuinty still owes her province an apology for his earlier refusal to support the oil sands.

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Bruce Cameron, a pollster with Return On Insight in Calgary, called the war of words between the two provinces classic Alberta electioneering as Ms. Redford prepares for a provincial election this spring. In a province where the failed National Energy Program is still a sore spot for many, she is pitting the West against its long-standing foe: Central Canada.

"It's a long tradition of picking a fight with the federal or centralist forces prior to an election," Mr. Cameron said.

Ms. Redford was speaking on Wednesday on the Dave Rutherford Show on CHQR radio in Calgary, which is generally considered the broadcast pipeline to the right wing. However, that bedrock of support for her Progressive Conservatives has been eroding with the emergence of the Wildrose Party, which polls have suggested is poised to become the Official Opposition.

When Mr. Rutherford said Mr. McGuinty was looking for something to blame for his province's struggling economy, and owed Alberta an apology, Ms. Redford agreed. "I think he does," she said.

Despite Mr. McGuinty's concerns about the "petro dollar," she said, others in Ontario agree with her position that the oil sands benefit Ontario's economy.

In fact, pollster Mr. Cameron said he believed Mr. McGuinty backed down from his earlier complaints about the "petro dollar" hurting Ontario's manufacturing sector after financial analysts pointed out that a lower dollar is not a panacea.

Ms. Redford has used data produced by the Canadian Energy Research Institute, which is funded equally by the Alberta government, Ottawa and the Canadian Association of Petroleum Producers, to support her argument that the oil sands benefit Ontario. The research concludes that 94 per cent of the economic activity to be generated by the oil sands between 2010 and 2035 will stay in Alberta and pointed to Ontario as the nation's second-largest beneficiary.

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Jason Myers, president of the Canadian Manufacturers & Exporters Association, said Mr. McGuinty was off the mark in blaming the oil-sands boom and high dollar for the problems in Ontario.

"Frankly, the big problem over the last three or four years has not been the high dollar because companies can adjust to [it]" Mr. Myers said. "The big problem has been the collapse of demand in the United States, which is our major market."

Mr. McGuinty is now saying he wants to pursue "common cause" with Ms. Redford by adopting her push for a national energy strategy, one that he says can incorporate Ontario's clean-energy sector as well as Alberta's oil sands.

"We have a shared responsibility to strengthen the national economy, each in our own way," Mr. McGuinty told reporters. "Isn't it great to be a Canadian?"

Where things go from here remains unclear. Ms. Redford's aggressive rebuttal of her colleague could undermine her own efforts to win support for a pan-Canadian energy strategy that would include the oil sands as well as renewable energy, said Roger Gibbins, president of the Calgary-based Canada West Foundation.

"Mr. McGuinty has been the most aggressive among the premiers in trying to shape or redefine an energy future for Ontario, and if his vision can't be drawn into our thinking about how we frame a Canadian energy strategy, then we're not going to succeed," Mr. Gibbins said.

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