Nova Scotia Takes Step Toward Energy Policy

The Nova Scotia government took a page from the U.S. notebook last Thursday, hosting a forum that brought together industry, consumer and international expertise --- including the U.S. ambassador --- in a process to develop a secure energy strategy. The forum, which soon will lead to a formal policy, also set a precedent as the northern Canadian province aggressively pursues expansion of its vast resources.

The keynote, by U.S. Ambassador to Canada Paul Cellucci, set the tone for the afternoon session, in which the former Massachusetts governor promoted President Bush's National Energy Policy and stressed that the Administration wants to cooperate in any way possible so that all of North American can reach its energy goals by 2020.

Nova Scotia is forecast to quadruple natural gas production to 2 Bcf/d by 2015, and the region has a rapidly growing export market for its production. However, the region also holds vast oil resources and other natural resource potential, said Premier John Hamm, who hosted the event. He said there were new opportunities in electric generation from traditional fuels, gas and renewable sources, such as wind and solar, that would evolve in the next decade.

Saying that the forum was taking one opportunity and turning it into more, Hamm said now the province will work to get a strategy in place to encourage all parties to work together. Cellucci, who as governor made several trips to Nova Scotia, said that the United States is "closely linked" to Canada, and said President Bush sees the future of the country tied with Canada's growth. "That reality has grown much stronger in the past decade," Cellucci said.

Hamm said that Nova Scotia has the "good fortune to have many energy options," but he said it was time to "learn about emerging solutions." Said Hamm, "Clearly, the demand for our energy is strong, and that demand is driving the search for new supplies." He stressed, however, that Nova Scotia had all forms of energy to consider. "The hot topic is offshore oil and gas," but he said other forms of energy and its consequences would be important for the province's future.

Hamm also stressed that energy companies wanting to work in Nova Scotia should keep commitments made to ensure the province's economic future.

"I believe that as the major players come to Nova Scotia and arrange business arrangements with the province, that they expect to keep those arrangements," Hamm said. "And I don't believe that they would expect, if in fact they are negligent in keeping those arrangements, that they should get off penalty-free."

Recently Hamm commented that oil and gas companies coming into Nova Scotia should be subject to fines if they failed to meet benefit commitments made to the province. His comments were criticized by some, but Hamm said they were not made to discourage investment.

"We're encouraging companies to come here, we're saying to them that we're willing to be good partners with them, but we're also saying to them, `look, we have a resource here,'" he said.

Though most of the energy executives attending the forum were reluctant to comment on Hamm's statements, PanCanadian CEO David Tuer, whose company has committed C$1 billion to develop its Deep Panuke field by 2005, said that he thought it was important to know what to expect. Tuer said companies have to have "very clear ground rules" in order to plan and go forward.

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