Vancouver (Platts)--10Aug2007

The leaders of Canada's 10 province and three territories ended a 
three-day conference Friday unable to agree on a national strategy for 
reducing greenhouse gas emissions (GHGs), with three oil and gas producing 
provinces spurning attempts to set absolute reductions and establish a 
carbon-trading program.
     Alberta Premier Ed Stelmach, whose province accounts for about 80% of
Canada's total petroleum output, told reporters he opposed the idea of a
cap-and-trade program from the outset after earlier telling the other
premiers: "Don't mess with Alberta."
     "We can't do this overnight," he said about attempts by some leaders,
notably Ontario's Dalton McGuinty, who supported "hard-cap" GHG reductions and
a program for trading of emissions credits.
     Stelmach was backed by Newfoundland's Danny Williams, who said Thursday
that, regardless of the need for action, "I don't believe in running with
undue haste that could hurt the economy down the road.
     "We don't want to save the world on the back of Alberta," he said.
     Nova Scotia's Rodney MacDonald sided with Stelmach and Williams, while 
Saskatchewan's Lorne Calvert, a strong advocate of lowering GHGs, was hesitant
about moves to enforce caps and introduce trading.
     Stelmach has promoted a policy requiring industry to reduce the intensity
of emissions per unit of production, rather than setting across-the-board
targets that make no allowance for rising production. Effective July 1,
Alberta requires an estimated 100 companies emitting more than 100,000 metric
tons of GHGs a year to reduce their emissions intensity (carbon produced per
barrel of oil or Mcf of natural gas) by 12%, or face financial penalties of
C$15 per metric ton for emissions above their limit.
     Stelmach said trading carbon credits would not help Alberta's economy by 
"sending the money some place else" without any net reduction in Canada's
GHGs.
     McGuinty suggested adopting California's motor vehicle emissions
standards, despite the impact that would have on Ontario's auto manufacturing
sector that provides 326,000 direct and related jobs.
     "What I'm talking about is all of us having to give a little in order
that we can all gain a lot," he said.
     "We're prepared to find a way to get a California emissions standard
nationally. But I'm not prepared to do all the heavy lifting," McGuinty said.
     Quebec's Jean Charest, although he supports absolute GHG reductions and a
multi-jurisdictional carbon-trading market, said he would try not impose any 
measures on Alberta. "We're part of a federation, not part of a unitary system
of government," he said.
--Gary Park, newsdesk@platts.com