|Tony Kay, British Consul General, Calgary
|Address by the Drew Ross, Managing Director, Scotia Waterous
A Global E&P Capital Markets Perspective: Which companies and assets are investors deciding will survive the oil price war
|Session 1: How industry is adapting to low oil prices
The squeeze is on in the Alberta energy sector. Oil companies are shoring up balance sheets and enforcing capital discipline as project costs creep up and shareholders pressure management to focus only on the most profitable ventures. Major Canadian oilsands companies can run their existing operations profitably in a sub-$50 oil-price environment, but it’s the cost of large new projects on their balance sheets that are weighing down companies and their share price. Contingencies are being put in place for an extended run of oil prices far below the triple-digit levels of recent years as crude is oversupplied and much of that oil is produced at a lower cost than in Canada. Indeed, much of the Canadian oil patch was built to prosper with U.S. oil prices at $80 (U.S.) to $100 a barrel, or even higher. Can Alberta bring costs down fast enough, and find enough new markets, to stay globally competitive? The panel will examine the strategies that are being pursued to survive, and thrive, in this challenging energy environment.
Moderator: Chris Christopher, Partner, Blake, Cassels & Graydon LLP
|Address by Mark Marissen, Chief Strategy and Communications Officer
Earning social license for energy projects in British Columbia
|Session 2: Improving capital project outcomes in a cost-driven world
We may be witnessing the fundamental realignment of an industry where producers on the high end of the global cost curve will have to adjust to a world of far tougher competition and sluggish demand. In the last twenty years in the oil and gas industry, the delivery of capital projects has suffered from cost and schedule over-runs, almost to the extent that they are expected but still not accepted. This reality is a feature of energy projects delivered in Western Canada, where companies repeatedly outline their resolve to get their capital projects under control, only to see the problem repeat itself again with the implementation of new strategies. The panel will consider the industries understanding of the reasons for cost and schedule over-runs, and discuss best practices for improving predictability, reducing labour costs and outcomes for industrial projects including: Do supply chain, finance, or engineering offer the best solutions for success? Are there projects delivered in other parts of the world that may be well-suited to the operating environment in Western Canada, or are there unique circumstances in the region that preclude the importation of global solutions? To what extent can global sourcing help solve project challenges, and to what extent can challenges be solved with made-in-Canada solutions?
Moderator: Adam Crutchfield, Partner, PwC
|Luncheon with remarks by Sophie Brochu, President & CEO, Gaz Metro
A national energy approach
|Afternoon Session 1: Will Canada get the LNG formula right?
Next to the Alberta-based oil patch, the mood in the British Columbia LNG sector remains upbeat. Ottawa’s announcement last month of an accelerated capital cost allowance for the LNG sector follows BC’s reduced its tax on LNG plants announced last October. The oil slump that has resulted in large layoffs across Alberta is also improving the case for LNG by potentially making more skilled workers available for BC’s North Coast. But while Canadian developers finalize the economics of their specific projects, four U.S. projects have received approval. If all the projects proceed, the U.S. could become the world’s second-largest LNG supplier after Australia by 2020. In contrast, there are no Canadian projects with a firm commitment to proceed. Canadian LNG continues to be linked to oil prices, and as oil drifts lower, the delta gets smaller, weakening the business case for Asian buyers. The panel will examine the two markets and discuss if Canada will get the LNG formula right.
Moderator: Reynold Tetzlaff, National Energy Leader, PwC Canada
|Afternoon Session 2: Carbon regulation and the energy industry
Leaders at the recent G7 Summit in Germany agreed to phase out the use of fossil fuels by 2100. While this is an aspirational goal, there is no doubting that the issue of climate change and correspondingly, the need to reduce carbon emissions is top of mind. Prior to the Summit, Europe’s top oil and gas companies urged governments around the world to introduce a pricing system for carbon emissions. The UN will attempt to hammer out a binding deal to fight climate change in Paris later this year. Ontario has recently announced that it will join Quebec in an emissions trading scheme and both provinces have outlined a series of conditions for energy infrastructure projects, including new pipelines, that pass through their territory. In addition, Alberta Premier Rachel Notley aluded to changes to emissions regulations during the election campaign and has announced a royalty review for the already high cost oil sands. Panelists will examine what future regulatory changes might look like and how industry can prepare.
Moderator: Pierre Alvarez, Vice Chair, Global Public Affairs
|Close by Jason Langrish, President, The Energy Roundtable