Shell’s Canadian head stepping down

The outgoing head of Royal Dutch Shell PLC’s Canadian unit is urging the new federal government to firm up its stand on major pipeline proposals, warning that delays to projects currently before regulators would deal a severe blow to an industry already pummelled by the collapse in oil prices.

Lorraine Mitchelmore said Justin Trudeau’s Liberals should consider Canada’s overall competitiveness as a global crude producer as they craft tougher rules around pipeline reviews aimed at reversing controversial changes introduced by the former Conservative government.

“Canada has to exist in a global marketplace, and so we have to think that way,” Ms. Mitchelmore said Monday during an interview at the company’s Calgary headquarters.

She urged the federal government to act quickly with changes that balance environmental goals and economic imperatives. “It needs to figure it out soon. It needs to figure out its objective, and figure out what mechanisms we need to be able to compete globally,” she said.

Ottawa’s position on proposals such as Kinder Morgan Inc.’s $5.4-billion Trans Mountain expansion and TransCanada Corp.’s $12-billion Energy East project has come under greater scrutiny in the wake of U.S. President Barack Obama’s move to scupper TransCanada’s Keystone XL pipeline earlier this month.

Both companies are seeking National Energy Board approvals to vastly expand Canada’s export capacity from the West and East Coasts. But several environmental groups have urged Mr. Trudeau’s government to put the applications on hold, arguing the proposals should be subject to more rigorous screening that includes an assessment of the industry’s greenhouse gas emissions.

Shell’s Canadian head stepping down, calls for government pipeline action

Energy companies such as Shell, Suncor Energy Inc. and others are clamouring for additional export capacity even as they dial back spending and abandon major expansions in the oil sands to cope with the sharp plunge in U.S. and global oil prices to under $50 (U.S.) a barrel.

Last month, Shell incurred a $2-billion charge after the company took the rare step of halting construction on a major oil sands project called Carmon Creek. It cited high costs and a lack of pipelines to transport the supplies to global markets as reasons for the decision.

The federal government has so far said little about what changes are planned, saying only that it will revise the current environmental assessment process and that existing applications will face higher standards. It is unclear, for instance, whether any changes would reverse a Conservative government measure that gave the federal cabinet final say over such projects.

Mr. Trudeau has committed to a tougher review of the Trans Mountain proposal, which would nearly triple capacity on an existing westbound pipeline to Burnaby, B.C. He has also moved to formalize a ban on oil tanker traffic on B.C.’s northern coast, effectively killing Enbridge Inc.’s Northern Gateway pipeline.

Ms. Mitchelmore would not comment specifically on that decision, saying only that the energy industry would struggle to compete without access to richer global markets.

Ms. Mitchelmore joined Shell in 2002 and spent the past six years as country chair. In recent years, she has been a vocal advocate for establishing a system for pricing carbon in Canada. She is to be replaced by Michael Crothers, currently vice-president of production unconventionals, North America, effective Jan. 1. Ms. Mitchelmore said she is leaving Shell to spend more time with family.