Canada’s regulatory system is OK, Rex Tillerson says
How would you rate Canada’s regulatory system?
Joe Oliver, Canada’s Natural Resources Minister, is fond of citing the long-delayed Mackenzie Gas Project when he decries the current apparatus as an “unpredictable” and “needlessly complex” labyrinth of permits and approvals.
Yet a very different picture emerged in a “bizarre” speech, as one astute watcher put it to me in an e-mail, given last week by ExxonMobil Corp. chief executive Rex Tillerson.
Tillerson, making an appearance at Exxon’s annual investor conference at the New York Stock Exchange last Friday, said Ottawa is a better place to do business these days than Washington, according to the industry newspaper Upstream.
He blamed “dysfunctional” regulations on Capitol Hill for slowing the American economy, noting that decision-making there is often a “byproduct of political calculations.” Compare that to Canada, which Tillerson said has a “very rigorous, well defined … and lengthy” approach to assessing major projects, Upstream reported.
The truth is probably somewhere between these two portraits.
Oliver is eager to deliver Canadian oil to overseas markets. Exxon-controlled Imperial Oil Ltd., meanwhile, is poised to commission the first phase of its 4.6-billion-barrel Kearl oil sands mine at some point this year. (The resource occupies a larger role in the company’s portfolio than officials might care to acknowledge).
It’s worth noting, too, that Exxon says its output will slide three per cent this year from last. The dysfunction in Washington described by Tillerson provides a useful distraction from the lingering impression held by some analysts that his firm’s $36-billion acquisition of XTO Energy is looking less strategic than previously hoped amid distressed North American natural gas prices.