Open letter to Prime Minister Legault


QUEBEC, October 14, 2021 / CNW / –

Mr. Prime Minister,

I take the liberty of writing this letter to you from one businessman to another.

Utica Resources, the company I founded, is today one of the largest holders of hydrocarbon rights in Quebec.

As you know, the Hydrocarbons Law adopted in 2016 had the clear objective of creating a legal framework that would lead to the production of oil and natural gas discovered in large quantities on our territory, paving the way for the development of this strategic industry for Quebecers. Ultimately, this law would allow us to produce at home the hydrocarbon resources that we import each year at the cost of several billion dollars.

My team and I enthusiastically welcomed your election as Prime Minister of Quebec in October 2018. We were convinced that you would support our projects aimed at creating collective wealth, securing energy supplies and reducing GHG emissions, because local consumption remains a better environmental option than importing. Your public statements spread over several years align perfectly with our views on this strategic issue for Quebec.

We rigorously followed the Quebec regulations and applied for a drilling permit for the Galt project, in Gaspésie, in which the government of Quebec (through Ressources Québec) is a partner. However, although the MERN specialists who carried out an in-depth analysis of the file unanimously recommended the issuance of the drilling authorization, including the Associate Deputy Minister who said that our file could not be better presented and had no doubts about its quality, the drilling authorization was rejected by Minister Julien, which unfortunately forced us to seek redress from the Courts.

The refusal of the Minister of Natural Resources to Quebec to issue the drilling authorization does not comply with the Hydrocarbons Law and was not supported by a thorough analysis or detailed understanding of the file, which he admits not having read. This is hardly the behavior that a serious businessman would expect from a senior government official, especially one responsible for managing the reasonable development of the country’s natural resources. Quebec for the good of all of us – so as not to stop the development of of Quebec resources to appease a small but noisy minority. The government’s behavior is all the more difficult to understand as Ressources Québec and the MERN had already demanded Utic to go ahead with the Galt project and a member of your own cabinet then confirmed to us that your government supported this type of project.

In recent weeks, media have reported that your government is on the verge of expropriating the companies that hold the rights to explore and produce hydrocarbons in Quebec. Meanwhile, an unprecedented energy crisis is unfolding in Europe and also affects Quebec where we are experiencing a dramatic rise in natural gas prices. This crisis could well continue, resulting in significantly higher costs for a multitude of Quebec industries that consume large amounts of natural gas, as well as hundreds of thousands of residential and commercial consumers. We do not understand how giving up the production of our own natural gas reserves, an essential resource for the energy transition, could be a good decision for Quebec without running the risk of reproducing the European crisis here. As you know it, Quebec has even fewer alternatives than Europe to resolve such a crisis because we are entirely dependent on United States and Western Canada for our gas supply.

In good faith and encouraged by the government of Quebec, the industry has invested hundreds of millions of dollars to find sufficient resources to ensure the energy independence of the province, resources that are now worth hundreds of billions of dollars. Expropriation without fair compensation would have devastating effects on of Quebec reputation among international investors whose capital is essential for of Quebec economic development. It would also be contrary to Quebec legislation, which presupposes compensation at a minimum of fair market value in the event of expropriation. How could it be otherwise? How could a citizen whose business or house has been expropriated not be offered at least fair market value compensation from the government?

Either way, now is the time to act. After so many years of sending mixed signals, the government of Quebec must take responsibility and decide once and for all. Either it works in good faith with the industry to manage the energy transition by developing the important oil and natural gas resources on its territory in an eco-responsible way, taking advantage of both stable energy prices and more jobs, or it expropriates the oil and gas industry by offering fair and equitable compensation.

This letter is all the more difficult for me to write as I have been a proud supporter of your party whose main vision, the collective enrichment of Quebec, corresponded perfectly to my point of view as well as that of the majority of your partisans.

In conclusion, I believe that it is urgent to organize a meeting to discuss this very important issue for the future of Quebec.

Best regards,
Mario Lévesque, President and Chief Executive Officer

SOURCE Utica Resources


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