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Shale Gas Could Doom New Brunswick Government, Expert Warns

When voters in New Brunswick went to the polls last September, they were still fuming over the incumbent Liberal government's failed attempt to sell the province's public utility. Premier David Alward and the Progressive Conservative party were able to harness that dissatisfaction and won the 2010 election in a landslide.

Now, outrage over another energy issue -- shale gas development in the emerging Frederick Brook Shale -- could doom Alward and the Conservatives, a veteran political scientist warns.

"Political parties in New Brunswick enjoyed many years of incredible stability," Don Desserud, dean of arts for the University of Prince Edward Island, told NGI's Shale Daily on Thursday. "Until very recently, no party ever lost an election after one term and very rarely after two terms. Once you were elected, you were in for a long time. But that situation has changed considerably."

No one should know that more than former Premier Shawn Graham and the Liberals. In October 2009 Graham and Quebec Premier Jean Charest announced that Hydro-Quebec would acquire New Brunswick Power Corp. (NB Power) in a deal later valued at C$3.2 billion. The plans fell through by the following March (see Power Market Today, March 25, 2010; Oct. 30, 2009).

"No party once in power is safe," Desserud said. "The Liberals thought they were safe and then they ran into the debate over their proposed sale of NB Power. It generated a lot of protest and controversy in the province. They eventually backed down but were punished at the polls. We've had swings back and forth in subsequent elections. As a consequence, we have a very volatile electorate quite willing to swing to one party or the other."

Desserud said shale gas development could be a "parallel issue for the Conservatives" and Alward, who have steadfastly refused to enact a moratorium on hydraulic fracturing (fracking) in the province despite recent protests (see Shale Daily, Aug. 15; June 24). The protests, coupled vandalism and thefts, recently prompted Southwestern Resources Canada, a Southwestern Energy Co. subsidiary, to halt seismic testing in the province earlier than expected (see Shale Daily, Aug. 25).

According to Desserud, shale gas development "speaks to an emerging political culture in the province where the public has lost confidence in the political institutions to respond to their concerns. So governments now have to move into these areas with great caution because they know they could trigger a considerable backlash, which could in the end punish them when the next election comes."

That probably won't happen until 2015 at the earliest, when New Brunswick has its next election. Although the province has a parliamentary form of government, Desserud said there aren't enough Liberals to force an election earlier through a no confidence vote. But he added that campaigning for the next election should begin in 2013.

"That's not so far away in political calendars," Desserud said.

Desserud added that the Liberal party -- now the province's official opposition -- would have trouble capitalizing politically on discontent surrounding shale gas.

"They're vulnerable on this and they know it," Desserud said. "This is fundamentally an energy issue, and they were brought down on an energy issue. Right now they're focusing on the Conservatives and their promise that they wouldn't make a decision [on shale gas development] without widespread consultation. The Liberals are saying the Conservatives didn't do that and were therefore breaking their promise."

Desserud said another potential stumbling block for the Liberals is that they have yet to select a party leader. But that probably won't happen until the next election is closer.

Nevertheless, Liberal party interim leader Victor Boudreau has taken shots at Alward over the shale gas issue.

"New Brunswickers continue to express serious concerns about fracking-related activities happening in their backyards," Boudreau said on Aug. 10. "Unfortunately, their concerns are not being acknowledged by Premier Alward. This is a premier who campaigned on a promise of being open and transparent with New Brunswickers, and giving them the opportunity to have a voice on important issues. However, he and his caucus have done the opposite on the issue of shale gas."

Desserud said the Conservatives have not done a good job educating New Brunswickers about shale gas, but that could be changing.

"It's a technical issue that is complicated and difficult to explain to a lot of people," Desserud said. "I think they have the information and they have the campaign. I'm starting to see, from the [shale gas] industry anyway, a campaign rolling out to explain what's going on. There are some very effective photos that are showing the distance between the drilling for an artesian well and the drilling for shale gas. The scale is pretty remarkable.

"But I haven't seen the government [campaign] yet. I don't think they have decided exactly how they want to brand themselves with this issue. They're obviously in favor of it, but they're tentative on wading in just yet. I don't know why."

One possible explanation is the issue of mineral rights, which property owners in the province don't own.

"I don't think the anxiety of the property owners is being addressed by the government or the education campaign that is out there," Desserud said. "The property owners are being told that the risk to their property is minimal, but they're not being told the risk is zero. The compensation to them is also minimal; they're not going to become rich because someone discovered gas on their property. But the province will prosper considerably if this gas can come on line.

"So you basically have a situation where the people who own the property are being asked to accept risk, but in a worst case scenario they would lose their property and their whole life. Although the risk is minimal, they feel it is still too significant for them to take that chance."

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