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Shell leads energy charge

Canada key global player in developing resources

By Lorraine Mitchelmore, Financial Post March 19, 2011 4:03 AM

When the company that was to become Shell Canada Ltd. was established in Montreal 100 years ago, on March 21, 1911, the potential for the country’s energy industry was in its infancy, with few aware of the vast resources Canada had locked away.

The full potential of the extensive energy resources of the West was unknown and the off-shore fields on the East Coast remained undiscovered beneath the Atlantic. A century ago, alternative energy was oil and gas.

When the oil and gas boom eventually came, it changed Canada’s economic landscape more fundamentally than any event since the completion of the Trans-Canada railway in 1885. Today, Canada has the second largest oil reserve in the world, it is the third largest natural gas producer and it has one of the cleanest electricity sectors. Oil and gas alone generate approximately $100-billion a year in revenue. By comparison, sale of wood generates about $10-billion.

Today, beyond our worldclass hydrocarbon reserves Canada has made tremendous strides in the development of alternative energy. We are a significant global producer of hydro, wind and nuclear energy and we have begun to build capacity in biofuels.

Our success has placed Canada at the forefront of the global energy hierarchy. Along with Norway, we are the most stable, the most reliable and the most democratic of the world’s top 10 oil and gas producers.

That’s a distinct competitive advantage given the current turmoil in North Africa and the Middle East, where five of the other top 10 producers are located.

As a relative newcomer to the global energy stage, Canada must demonstrate that it has earned the right to tap the global market for our products and to position ourselves as the reliable, stable and socially responsible supplier of choice for an energy-hungry world.

Asia in particular will require vast amounts of energy to fuel its booming economies, and Canada is a natural supplier. Our energy companies have the global reach and the know-how to provide access to the Asian market.

Over the course of Shell’s 100 years in Canada, we have observed, learned, created, improved and shaped how energy development has evolved in this nation and we are now well positioned to support the growth of Canada’s share of the global energy market. Driven by a growing population and everincreasing demand, the need for stable and secure access to energy will increasingly see the world turn to this nation for energy -Canada is on the cusp of becoming a global energy superpower.

But developing the export markets that will get us further ahead requires collaboration among all stakeholders -energy companies, governments, communities and NGOs -to develop an energy strategy that will meet their respective needs and benefits Canada. Shell firmly believes that a collaborative approach is possible and we are helping on many fronts.

To realize our potential as an energy superpower, the nation’s energy strategy needs modernization to ensure we create a fiscal and regulatory policy that promotes our international competitiveness. Key elements of the policy should be a price on carbon, sustainable and affordable energy with a reduced carbon footprint, and a national rather than a regional approach to our energy market.

The benefits of a national energy strategy are obvious: It will support a balanced approach to strengthening the economy, improving the environment and turning environmental stewardship into economic advantage.

We believe it is completely appropriate for Shell Canada to be talking about Canada’s place in the global energy landscape and what the country needs to do to become truly competitive internationally.

As a deep-rooted Canadian company, we have a vested interest in the future of the country’s energy industry and its economy.

We also understand both the Canadian and the global energy markets, and as part of the Royal Dutch Shell company, we have access to technology, knowledge and best practices that we can apply locally to support Canada’s effort to succeed globally.

While Shell’s contributions will be significant, Canadians will have an important role to play in our country’s success through energy conservation, efficiency and literacy, and as they learn more about the value of energy to this nation, they will gain an appreciation for the need to have an export market for energy products.

The right policies and constructive engagement among stakeholders are the best ways to work out how to achieve this and to address issues such as opposition to the oil sands, the construction of new pipelines, coastal tanker traffic, continued development of alternative energy sources and foreign investment in the energy sector.

Shell Canada has a history of working with stakeholders to resolve tough issues and through sharing our 100 years of knowledge, we look forward to the opportunity to contribute to this dialogue.

Lorraine Mitchelmore is president and country chair of Shell Canada, which celebrates its 100th anniversary on Monday.

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