Saudi Arabia is buying shares of Alberta’s oil sands companies. The ‘ethical oil’ argument is dead.

As I worked with a number of those mentioned in the article, couldn’t resist reposting this. Alykhan Velshi, a really bright guy, has of course in a further irony, ended up shilling for Huawei despite the overall Conservative suspicion of China:

When Norway’s massive pension fund announced that it had sold its positions in major Canadian energy companies like Suncor and Canadian Natural Resources, Alberta’s premier came out swinging. “To be blunt,” Kenney told reporters last week, “I find that incredibly hypocritical.” After all, he said, Norway continues to develop its own oil and gas resources, including the 2.7 billion barrels that are contained in the new Johan Sverdrup field that is already producing 430,000 barrels of oil per day.

For those of a less pugilistic orientation, Norway’s decision might be seen as a prudent act of financial diversification; one that Alberta could easily emulate if it wanted to. If Norway is already producing oil and benefitting from the tax revenue and jobs it creates, there’s no need for them to double down by also investing their one-trillion-dollar nest egg in companies that also depend on the price of oil. This isn’t a philosophy that’s particularly popular in Alberta, mind you, given Alberta Investment Management Corporation’s well-documented history of being more heavily exposed to the energy sector than other pension funds.

But while Kenney was quick to call out Norway’s alleged hypocrisy in selling their shares of oil sands companies, he has so far remained silent about the news that Saudi Arabia’s Public Investment Fund was busy buying them. As Bloomberg reported last week, it now owns 2.6 per cent of Canadian Natural Resources, and two per cent of Suncor, which makes it the eighth and 14th largest shareholder in the two companies respectively. Ironically, it also added to its position in Equinor, the Norwegian company that’s developing the Johan Sverdrup field.

As Premier, Kenney has been at the forefront of recent efforts to paint Canadian oil and gas as more “ethical” and therefore more worthy of investment. This narrative, which was first advanced by Ezra Levant, has been deployed most visibly in the conversation about the Energy East pipeline and the decision by New Brunswick’s Irving Refinery to buy its oil from Saudi Arabia rather than Canada. But Kenney’s affiliation with it goes back much further than that. It was his former director of communications and parliamentary affairs, Alykhan Velshi, who created the “Ethical Oil Institute” in July 2011, and his former executive assistant, Jamie Ellerton, served as its executive director between January 2012 and April 2013.

Kenney is hardly alone in his fondness for Levant’s narrative, though. Its core tenets—namely, that Canada’s legal, environmental and regulatory standards make our oil more inherently virtuous—are practically articles of faith in the oil and gas industry. In an interview with the Calgary Herald, Nancy Southern, the CEO of Atco and a founding member of the Business Council of Alberta, was quick to invoke it: “I think it is time for people to stand up and demonstrate true moral leadership about the fact that the world is better because of petroleum products,” she said.

But if Saudi Arabia’s oil is a conduit for its anti-democratic and values, as ethical oilers like to argue, then what about its money? That money comes from the sale of its own ethically-challenged oil. Suncor and Canadian Natural Resources can’t prevent Mohammed bin Salman or the Saudi Public Investment Fund from buying their shares, but those who have been more than happy to bang the drum about Saudi Arabia’s moral and ethical failings could speak up here.

So far, though, they’ve been conspicuously silent. Take Eric Nuttall, a fund manager with Ninepoint Investments and a frequent purveyor of the ethical oil narrative. In a recent tweet, he sounded positively delighted by the development, and made no mention of the ethical dimensions of Saudi Arabia’s money. “So much for Canadian oil companies not being attractive to foreign investors!” He wrote. “We are 100 per cent invested in Canada given highly attractive valuations and improving takeaway capacity and it’s interesting that Saudi Arabia agrees with us.”

In fairness to the industry, it’s hardly alone in speaking out of both sides of its mouth about Saudi Arabia. The federal government recently renegotiated a $14 billion deal that will allow the sale of Canadian-made light-armoured vehicles to the kingdom (a deal that was originally struck by the Harper government back in 2014). And MBS hasn’t been shy about using Saudi Arabia’s wealth to buy its way into companies and communities throughout the west, including a recent bid to buy the English Premier League’s Newcastle United football club.

But if Canadian oil and gas companies are going to accept Saudi Arabia’s money, it’s probably time for their proxies to retire arguments about the immorality of their oil. After all, as Jason Kenney will tell you, nobody likes a hypocrite.

Source: Saudi Arabia is buying shares of Alberta’s oil sands companies. The ‘ethical oil’ argument is dead.

Huawei Canada exec insists CFO Meng Wanzhou is victim of ‘politicization’

Always somewhat amusing when a former senior minister (John Baird, shilling for Saudi Arabia) or former senior aide, in Alykhan’s case, works for a Chinese company despite having been part of a government with legitimate concerns over Chinese influence.

And good on the reporter for challenging him for his firm not making representation to free the two Michaels:

One of Huawei’s Canadian bosses says he is concerned about the “politicization” of its CFO’s case south of the border, but dodged questions on why the firm won’t speak out more strongly for the two Canadians arbitrarily detained in China.

In an interview with The West Block‘s Mercedes Stephenson, the executive and former director of issues management for Stephen Harper’s government insisted Huawei Canada respects Canadian laws but did not answer when asked whether the branch would call for the release of Michael Kovrig and Michael Spavor.

“Well, you know, we’re concerned. We’ve said that we want the two governments to work together to find a resolution that can bring them home as soon as possible,” said Alykhan Velshi, vice president of corporate affairs of the Canadian branch of the Chinese company.

“With respect to Meng Wanzhou, obviously she has access to Canadian court, she has lawyers here and we remain confident that she will be found innocent because she is innocent and we remain alarmed by the politicization of her trial down in the United States.”

He would not clearly explain why the domestic branch of the company isn’t saying the same for fellow citizens Michael Kovrig and Michael Spavor, detained by the Chinese government in apparent retaliation for Canada’s observance of its extradition treaty with the U.S.

Under that extradition treaty, Canada honours roughly nine in every 10 requests from the U.S. and it is the courts that decide on the merits of a case for extradition, with the ultimate decision lying at the very end of the process with the Minister for Immigration only in the event extradition is approved.

“If you’re alarmed by that politicization, are you not alarmed that these Canadian citizens are being held on what the Canadian government says are completely specious charges?” Stephenson asked Velshi.

“As I’ve said, we’re concerned. I think all Canadians are concerned by what’s happening over there by their treatment and we want this resolved as soon as possible,” he responded.

“But the solution can only be found by governments working together — by our government here in Ottawa, by the government in China, diplomats working together so we can bring them home as soon as possible. That’s our hope and I think that’s the hope of all Canadians.”

Kovrig, a diplomat on leave from Global Affairs Canada, and Spavor, an entrepreneur, were detained by Chinese authorities last December.

The action came just days after Canadian authorities arrested Meng on a provisional warrant from the United States. Shortly afterwards, the U.S.  charged her and her company with allegedly skirting sanctions on Iran and stealing corporate secrets.

Kovrig and Spavor were held without charge until May 2019, when China formally arrested them on accusations of spying.

They have been kept in conditions described as “harsh,” with no access to lawyers and with the lights on 24 hours a day.

They have received only limited consular visits.

Meng, meanwhile, is out on bail and living in one of her Vancouver homes.

She is currently fighting extradition to the U.S., a process that could take years.

Huawei is seeking to bid on the upcoming 5G spectrum auction but faces allegations from intelligence agencies and experts around the world that it poses a national security risk because of a Chinese law that requires Chinese companies to spy for the state if requested.

Canada is currently in the midst of a review on whether to allow Huawei to bid in that auction.

Officials here are under pressure though from the Americans, who have deemed Huawei an unacceptable security risk and implemented a ban on U.S. companies using its technology. However, they have also issued repeated exemptions to that ban, most recently last month.

Source:  Huawei Canada exec insists CFO Meng Wanzhou is victim of ‘politicization’ – National