Canada's energy industry is on the cusp of a potentially lucrative future, but "massive" investments in new energy supply, pipelines, electricity transmission infrastructure and renewable technologies are needed to overcome looming challenges, The Conference Board of Canada reported on Monday.
The nonprofit economic consultant issued a sweeping series of recommendations in The Canada Project's final report, "Mission Possible, a Canadian Resources Strategy for the Boom and Beyond." The project, launched by the board in January 2003, brought together 45 public- and private-sector groups to help national and provincial decision-makers set policy direction for all sectors of Canada's economy.
"Canada has ample energy resources to help meet North American and global demands, but to do so, the energy sector will need to invest significantly to boost production and transport the energy to market," the report stated. The authors said Canada's energy sector faces three main challenges over the coming decades:
The heat used to process oilsands bitumen now comes from natural gas, "so the projected squeeze on natural gas supplies will increase operating costs," the report stated. To keep gas flowing at current or higher levels, "investments will need to be made in offshore and northern frontier resources, coalbed methane, hydrates (natural gas trapped in frozen form) and tight sands...and imports of liquefied natural gas (LNG)."
Canada has an abundance of confirmed and undiscovered reserves of gas. "Unfortunately, delays abound. Major technological problems have to be overcome before production plans can be implemented. And with the long lead time required to develop these resources and to build infrastructure, consumers will not have access to these new resources until at least 2010."
On an "optimistic note, Canada's burgeoning LNG facilities could boost supply if adequate offshore natural gas imports can be secured," the report stated. "Canada is not yet a major international player in LNG, but it could become a noteworthy North American player."
Eight LNG regasification plants in Canada are already under construction or planned: three in Nova Scotia, two in British Columbia, two in Quebec and one in New Brunswick. The report noted that LNG proposals in Eastern Canada "face stiff competition from similar LNG proposals in the United States. But Canada has an advantage in that public opposition to development projects is not as strong here as that demonstrated by our southern neighbors."
If Canada is to achieve "sustainable prosperity," the report suggested that the country's leaders will have to find an "appropriate" mix of energy resources, optimize its hydroelectric potential, develop emerging renewable energy sources, encourage energy conservation and efficiency, and develop and implement new fossil fuel technologies to resolve environmental issues.
To download a copy of the report, visit www.conferenceboard.ca/canadaproject .
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