Quebec may elect first female premier on Sept. 4

Quebeckers go to the polls Sept. 4 to elect a new government. Predictions are that the Parti Quebecois will win making Pauline Marois the first female premier of the province.

The Globe and Mail relying on projections by ThreeHundredEight.com are predicting a minority or majority Parti Quebecois victory in Tuesday's election. However, as with the Alberta provincial election a big surprise is quite possible. A huge 28% of those surveyed in a recent Leger poll said that they might change their vote before they actually voted. Depending on how many actually change and in what direction any of the three top parties could actually win including the declining Liberals.

The final projections by the Globe source gave the PQ 34.1% of the vote and from 57 to 75 seats. The more likely result is given as 63 seats. The range of results could result in a minority or majority government. The Liberals are predicted to gain 27.9% support and between 25 and 39 seats with the more likely being 33. This would be the worst Liberal result since the PQ won in Quebec in 1976.

The Liberals might not even form the official opposition as the Coalition Avenir Quebec (CAQ) has 26.3% of the vote and should win between 20 and 31 seats. The most likely result is 27 seats The CAQ has been draining off anglophone votes from the Liberals. Of course the result may not always be a win for the CAQ but for the PQ in some constituencies.

The Liberals are heavy favorites in the Montreal area and still will probably form the opposition but Jean Charest the Liberal leader and premier may not be around to lead his party as polls show him losing in his own riding of Sherbrooke.

Quebec Solidaire a left separatist party is predicted to win one or two seats and almost double its vote from last election. The leader Amir Khadir appears headed for re-election and the co-leader may also win a seat. A final new separatist party backed by former Premier Jaques Parizeau is unlikely to win a seat and the same is true of the Green Party.

Polls show that the PQ has 37% support among francophone voters compared to just 30% for the CAQ and 20% for Liberals. However the Liberals have 61% support among non-francophones. The PQ needs to capture ridings in the suburbs of Montreal to gain a majority government. The projected range in seats is large from 15 to 24 seats. In the suburbs the Liberals trail both the CAQ and PQ badly.

The leader of the CAQ Francois Legault said that the race in Quebec was between the CAQ and the PQ. Stealing some of Jean Charest's rhetoric used to convince anglophones to vote for him, Legault said that a vote for the PQ would be a vote for a referendum on Quebec sovereignty in the near future. Perhaps this may sway some anglophone voters and also francophone voters who do not want a referendum at this time.

While the Globe and Mail seems fairly confident in their predictions they could be quite wrong and Quebec could turn out to be another Alberta.

Kuwait State Petroleum company seeks $4 billion deal with Athabasca Oil

Kuwait's state owned oil fund is seeking a joint venture with Athabasca oil in the oil sands. The deal will be for about $4 billion and is expected to be finalized by October

Kuwait Petroleum Corp. the state-owned oil company has signed a memorandum of understanding that would see the company invest around $4 billion in a joint venture with Athabasca Oil Corp. The venture would develop some of Athabasca's properties in the northern Alberta oil sands.

The agreement was confirmed by the Kuwaiti ambassador to Canada Ali al-Sammak. The final agreement is expected by October. Al-Sammak said in a telephone interview."..

“It’s a plus-or-minus $4-billion deal and in October they’ll be coming back to follow up what has been signed....So we’re doing very good – this proves that we’re good close friends.”

Sammak said Kuwait Petroleum wants to diversity its operations beyond the Middle East and also gain access to oil sand extraction technology as Kuwait too has heavy oil fields.

Many foreign-owned and state-owned oil companies seek to invest in Canada's energy resources. The Conservative government has encouraged this as a means to diversity the sources of capital and also capture new markets. Recently Chinese state-owned CNOOC has offered 15 billion for Calgary-based Nexen. Another deal involves Petronas of Malaysia who offered $6 billion for Progress Energy Resources Corp. Progress shareholders have approved that deal. Trading in Athabasca's stock was suspended on Friday before the news of the deal was announced.

These deals are just part of a host of pending foreign investments in the rich energy resources of Canada. Companies both state-owned and private from South Korea, Russia and many emerging Asian countries are negotiating with Calgary-based companies.

Many of the companies involved want the Conservative government to make its policy with respect to investment clearer. While there is a review to determine whether an investment is of net benefit to Canada, the exact criteria are not clear.

Wikimedia Commons

Map of oils sands in Alberta, Canada. The three oil sand deposits are known as the Athabasca Oil Sands, the Cold Lake Oil Sands, and the Peace River Oil Sands.

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Some within the Conservative government do not want to treat aggressive state-owned corporations on the same footing as private companies since these companies may not act on purely market principles. These companies include not only Chinese state-owned companies but those of Malaysia and Kuwait as well. Immigration minister Jason Kenney is one of those critics although he would make an exception for Norway's Statoil since it is run on market principles. I find it odd to talk of oil producers and market principles.After all many oil producers belong to OPEC whose whole purpose is to manipulate the market and influence prices. The aggressive nature of the state oil companies Kenney fears often result in high prices for shares that shareholders could never expect in the market.

The spate of negotiations in Calgary are not simply the result of foreigners anxious to invest in Canadian resources. Canadian companies themselves are actively seeking out these investments since they themselves lack the capital to finance expensive and often risky oil sands projects.

Athabasca for example has acquired many properties and now has 1.6 million acres in the oil sands but not the capital for development. Athabasca was able to develop the Dover and Mackay River properties only after it raised $1.9 billion by selling a 60% stake to PetroChina International Investment Co. which is state-owned.

The Canadian Association of Petroleum Producers predicts it will cost $23 billion to produce oil sands oil in 2012. By 2020 this amount could more than quadruple to $100 billion. This amount of capital is just not available within Canada. Canada needs both foreign capital for development and foreign markets for the oil. However, Canada might be better off it concentrated more on developing in other areas rather than simply being a convenient sources for raw materials to fuel the value adding industries of other countries. Oil and natural gas do not go bad if left in the ground, they might just increase in value.

Production in the oil sands in particular present many dangers to the environment. The costs of environmental damage will probably fall on the Canadian taxpayer rather than investors foreign or otherwise.