Three huge energy-based construction projects that Canada had hoped would help revive its economy and bring it energy independence are languishing on the drawing board, victims of the changing world oil picture and the Canadian government's nationalistic economic policies.
Recently announced setbacks to two of these projects have shocked the country, forcing Prime Minister Pierre Trudeau's administration to begin rethinking its strategies for business growth.
And criticism of the government for its regulation of the oil industry, which is widely seen as the key to improved living standards in this resource-rich nation, is mounting in intensity.
Donald McIvor, chairman of Imperial Oil, an Exxon Corp. subsidiary, said recently he didn't think Ottawa set out purposely "to reduce the industry's financial capability to the point where it would threaten the industry's basic health" or jeopardize Canada's drive to become self-sufficient in oil.
"Such, however, has turned out to be the case," he remarked.
Joe Clark, former prime minister and leader of Trudeau's parliamentary opposition, the Progressive Conservatives, said Trudeau was bringing about the "systematic destruction" of the petroleum industry here.
At the center of the storm is the 1980 national energy program, an ambitious overhaul of the rules governing the oil and gas industry that is one of the most significant policy initiatives of Trudeau's 12 years in office.
It includes higher taxes on oil revenues, increased government presence in the energy sector, and tax and financial measures intended to reduce ownership of oil and gas assets held by U.S. and other foreign firms.
The nationalistic push has led to a spate of takeovers of foreign companies--mainly U.S. oil companies--at a cost totalling more than $5 billion.
This is believed to have scared off foreign investors, whose contribution, though sometimes lamented, has been an integral part of Canada's economic development.
Until recently, many Canadians dismissed oilmen's complaints about the energy program as the habitual lobbying of big business when its interests are at stake.
But the industry's view acquired widespread currency when setbacks to two long-awaited energy projects were announced simultaneously on April 30, already labelled "Black Friday" by some Trudeau critics.
Shell Canada Ltd. said it was abandoning its planned Alsands project, a proposal to build a $10.5 billion plant in northeastern Alberta Province. The proposed plant would have produced synthetic crude from extensive deposits of heavy oil trapped in underground sands.
The decision galvanized Canadian sentiment because it was taken despite dramatic last-minute offers by Trudeau and the government of Alberta, the country's major oil-producing province, to invest $5.5 billion jointly themselves in the project and provide other financial incentives.
Explaining the move, Alsands President Ed Czaja stressed that "there has been the downturn in international oil pricing, emphasizing project risk and uncertainty."
Also on April 30, a two-year delay was announced for the planned Alaska Highway natural gas pipeline, a $37 billion joint U.S.- Canada construction job. Sponsors of the proposed 4,800-mile pipeline--which would carry Alaskan natural gas through Canada to the lower 48 states--have failed to line up financing for the massive undertaking.
A third big project, a $10 billion synthetic oil plant slated for Cold Lake, Alberta, by Imperial Oil Co. has been shelved indefinitely.
Altogether, the projects would have created more than 50,000 jobs during construction--a welcome prospect at a time when 1.2 million are jobless among a work force of 13 million.
These now-postponed projects were the leading edge of what the Trudeau administration has come to call its "megaprojects" strategy, an upbeat-sounding plan that envisions about $125 billion worth of investment in the resources, transportation and manufacturing sectors in the 1980s.
The setbacks to the megaprojects left the Trudeau government particularly vulnerable to charges that its economic policies were in shambles.
Essentially, the argument is that Trudeau's energy policy, by eroding business confidence and creating prolonged disputes with the governments of the oil-producing western provinces, has ruined the environment for high-risk, costly investments.
Looking ahead, Trudeau faces growing pressure to revise his energy and budgetary policies.
In a wider sense, the government almost has to swallow its pride and bring in new economic policies to replace part of the budgetary package announced in 1981.
A defense of the national energy program is being mounted. The Liberal's combative French-Canadian energy minister, Marc LaLonde, is alluding often to Exxon's recent decision to abandon the $5 billion Colony shale oil project in Colorado as evidence that energy problems aren't unique to Canada. "They have no national energy policy in the U.S.," he declares.
But Trudeau's options are severely limited. With the federal government deficit already expected to far surpass the projected $8 billion this year, it will be difficult to justify outlays to succor the petroleum sector or stimulate investment.