Brian Zinchuk is editor and owner of Pipeline Online
Buffalo Party Leader Phil Zajac, during a 2020 debate. Photo by Brian Zinchuk
ESTEVAN – Keep that coal-fired power burning, increase oil production to a million barrels per day, and promote refining in Saskatchewan. Those are some of the Buffalo Party’s energy platform in this provincial election.
The Buffalo Party is now fighting its second general election, and Phil Zajac is its leader. He’s running in Estevan-Big Muddy.
Zajac works in banking, but has previously worked in management in the truck sales industry, and ag equipment dealership. He’s also worked hotshot in the oilfield. He spoke to Pipeline Online at length on Oct. 9.
Asked what the Buffalo Party’s primary energy strategy is, he said, “The number one thing is to get to a million barrels a day of drilling, as quickly as possible.”
“We’re going to meet with stakeholders.
“We’re also going to strategically build refineries, small refineries. We’ll speak with people in the drilling business throughout Saskatchewan, and ask where we should build these? And my hope is building them in small towns, because we want to upgrade our oil to sell it for more money.”
He said they’d add construction jobs in small towns as well as retain jobs in those small towns. Zajac said, “We want people to have a reason to come to your Carnduffs, and Arcolas and Oungres. There’s no job creation going on.”
A small-scale refinery of the type he is referring to has been built in recent years near Kerrobert. After an initial insolvency, it is now in operation as Kerrobert Fuels.
Zajac would like to see massive tank farms built to store oil, similar in scale to the Enbridge tank farm in Regina. “We’re going to run on a farm mentality. So, if oil’s $20 a barrel, we’re still going to keep drilling. We’re going to help stabilize the industry. We’ll still keep drilling, and we’ll put it in the storage bin. When oil goes up in price, then we sell it. So again, this will create really good construction jobs for the people of Saskatchewan, really good operational jobs that remain.
“It’s no different than if a farmer has a crop and canola selling for $1, well, you’re not going to sell it, right? You put it in a bin and you wait till the price is good for you, right? So we’ll do the same thing.
“And the other thing that we want to try and do is we want to work with guys that are in the drilling business and find out a (oil price) that’s a good number for them. So just for an easy number, say 60 bucks a barrel. If they say, ‘Yep, we can make 60 bucks a barrel. We’re not going to get filthy rich, but we’re making money, and we’re good with that. We’ll work with them to do that. So, what happens now, oil goes to $20 or $18, everybody quits drilling, and you lose all your good workers, right? Because they have to go find jobs. We will work on a benchmark price, basically, and we’ll pay a 60, just keep drilling, fill the tanks. But then when oil goes above 60, that’s when we sell.”
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Multilaterals
In the 2024 budget, the Saskatchewan Party government brought in a multilateral well incentive program that provided a dramatic reduction in royalties, down to 2.5 per cent, on up to the first 16,000 cubic metres (100,600 bbls) of oil on new wells of this type. It’s the largest change in the oil royalty structure in two decades. The result has been a substantial adoption of this form of drilling. Would the Buffalo Party keep it, or do something different?
Zajac replied, “I’m not a professional, right in the oil industry, so I would do the same thing: speak to companies that are involved in that type of work and find out if it’s financially feasible for them to continue, or what we can do to make it better? But again, I as not a politician, I don’t know the best answer for that, and so I would just rely on people who are in the industry to guide me and help me get to a point of, yes, this is working, or no, it’s not working.”
Oil production target
At the end of a four-year term, what is the Buffalo Party’s goal for oil production in Saskatchewan, given its currently 454,000 barrels per day?
Zajac said, “we want to beat a million or better.”
Natural gas
Saskatchewan has only drilled around 10 natural gas wells over the last decade. We used to drill 2,318 natural gas wells a year. Does the Buffalo Party see any way of bringing gas production back?
(Editor’s note, the question was originally posed as 2,600 wells per year. In fact, it was 2,318 natural gas wells in 2003.)
He said, “I think the reason it slowed down is because of price, right? And the availability to use it here. And we do have gas plants, you know, that are being built.
“I don’t know the answer to that,” he said.
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Potash
Former NDP Energy Minister Eric Cline released a book last spring entitled Squandered: Canada’s Potash Legacy. In it, he makes the case for reevaluating potash royalties in Saskatchewan, suggesting a lot of money is being left on the table. With several parties offering substantial tax cuts in their platforms, where will the money come from? Will the Buffalo Party be looking at the royalty structure for potash, oil, lithium or helium?
“I think the royalty structure on oil would remain the same. Potash, I don’t think any new taxes are needed. I know some of the parties have talked about raising those. And again, as a party that believes in less government, less tax. I think that if you start increasing taxes on business, it makes it harder for them to operate, and sometimes they leave, right? So, I wouldn’t increase taxes.
Lithium and helium
What would the Buffalo Party’s approach be on lithium?
“I would actually bring the royalty levels are the same as oil. If you’re looking at that volume of production and it’s consistent, then it should be the same as oil.”
Asked about strategies for helium development, he explained he’s not familiar with it.
Power generation
What is the Buffalo Party’s stance on the federal Clean Electricity Regulations, he said, “We don’t think we would adhere to it. I would use the notwithstanding clause to prevent that type of interference in the province.
“We are on board with (carbon capture and storage) on all the power plants. We already have passed that policy. I think carbon capture is fantastic technology, and we should have Saskatchewan companies teaching it to the world. And it works.”
He noted carbon capture results in jobs and byproducts that can be sold. “It’s an attack on small town Saskatchewan, and there’s no reason for it,” Zajac said.
He pointed out SaskPower’s decision to not go ahead with further carbon capture and storage was one of the main reasons he was asked to enter politics five years ago. “I have so many clients at work at the mine and in power, and I don’t want them to lose their jobs. I don’t want them to leave their jobs. And I’ve heard people say, ‘It just few hundred jobs.’
“’It’s not,’ I said. It’s hundreds of families, kids, and the companies the small companies that supply parts, you know, and bolts and gloves. It’s not just 200 jobs.”
He added, “The guys I play hockey with work for power in the mine. Kids my daughter grew up with, they work in the mine. And when people that are as kind as Tim and Shirley (Huber) say, ‘Our town’s in trouble and we need help,’ how do you tell them ‘No?’”
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Nuclear power
The Scott Moe government has made a strong push to build nuclear reactors. Will the Buffalo Party continue that path or go on a different path? And if so, what?
Zajac said, “We’ve been submitting freedom of information requests on SaskPower stuff right now, and actually my candidate from Yorkton has SaskPower in court, and we’re probably going to win. But our thought is, if you read through that document, we went to the presentation, and we got the document for the program. Some things that are striking in the program is they specifically say to look for low population density population areas for the location, when they’re in the planning stage.
“And there’s no working facility like it in Canada. So, what we would do is, we know there’s a home for nuclear, just let someone else build one first, that makes sure it works. We got lots of coal. We don’t need to rush into this. We have a stable power source. So let’s let them work, build one, get the bugs worked out of it.”
Zajac said they are in court to find the costs from SaskPower. He said SaskPower is travelling around the province, marketing it. They’ve been in contact with a company that can build it. “There has to be a budget, right?”
“Now we’ve been told that there’s 1,000 pages regarding price. They had to make third parties aware of our freedom of information request, and the judge said you’re supposed to do that on day one, when you receive it, if there’s third parties involved.
“So we’re going find out. We’ve been doing the work of the opposition without having anybody in the legislature. You know, we’re showing a pattern in SaskPower that they think they’re beyond the rules. They can do whatever they want, and the rules don’t matter. And we keep catching them and stuff that they’re doing, and you won’t stop.”
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Power generation mix
If the Buffalo Party were to form government, how would Saskatchewan’s power mix look 10 years from now?
Zajac replied, “Ten years from now, we would still be heavy into coal.
“I think that a mix, a gentle mix of wind and solar is… I just have faith in people. Someone’s going to come up with some great type of fusion idea that will be some phenomenal source of power. It’s just going to take time.”
Asked what his thoughts are on coal, wind, solar, natural gas and nuclear, he said, “As far as my opinion, I’m not a fan of solar and wind. I think there’s a lot of downside to them. They’re cost-heavy. The maintenance is high on them. They create construction jobs while they’re being built. But there’s not a lot of jobs for people after, other than your maintenance, right?
“So is it a cost effective result for energy? I don’t think so. You build a big solar facility here. Farmers start harvesting and throwing dust, and you get dust on the screens, and it drops their functionality way down. We get hail, right? You get a bad hailstorm with baseball size hail, and knock them out.”
He noted a hail storm in June destroyed the windshields of vehicles in his yard.
As for natural gas-fired power generation, he said, “I think that my biggest issue with the natural gas, period, is the job loss, if we move away from coal onto natural gas, like Alberta. These are good paying jobs that have been around for decades, that have literally built these communities and rinks. And you start eliminating these jobs.
“And the other thing too is, and I talked in the last debate, last election, I asked Harpauer, I said, ‘So we lose all these jobs, right? That are high paid jobs, creating a tax base from the province. Where do you replace that those taxes? Because there’s no new jobs,’ I said, ‘All you can do is raise taxes, because it’s not five dollars, it’s millions of dollars.’ And she didn’t have an answer for that.”
He pointed out SaskPower increased rates by eight per cent to make up for a $180.7 million shortfall. “If you go three or four billion over budget, your power bill could double, or triple, to eat that overage in cost, right? Because there’s no other way to recoup it.”
In conclusion, Zajac said, “In the big picture, we know that we have coal for 300 years. It’s a very cost-effective source of energy and the jobs that it provides for small town Saskatchewan, we have to protect. And that’s why we’re the only party that’s rejected the UN 2030 agenda. We’ve passed policy that we will not adhere to any of that. And the Paris Accord, again, which is a UN design, we will not recognize the Paris accord either. The UN’s an unelected, unaccountable entity, and they should not be affecting the people of Saskatchewan’s lives or incomes.”
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—-
Pipeline Online is publishing verbatim all the relevant energy-related content in each party’s policy platforms. This is what is published in the Buffalo Party platform, which you can download it in its entirety here.
Buffalo Party of Saskatchewan Official Policy
Energy
•Right to Develop and Process Energy Resources: Legislation shall be enacted to guarantee the people of Saskatchewan the right to develop and process their own energy resources, ensuring availability to residents at affordable costs, free from global market pricing and foreign influence or constraints.
•Inclusive Energy Policy: The Saskatchewan government shall adopt a policy that supports all forms of energy and power generation, reflecting an inclusive approach to energy resources.
•Grid Reliability: The Saskatchewan government and all crown corporations shall prioritize grid reliability in their energy policies.
•Restriction on Coal Reserve Ownership: Ownership of strategic coal reserves in Saskatchewan shall be restricted to Canadian residents and corporations.
•Tax Incentives for Research and Development: A tax incentive in the form of 100% expensing for tax purposes shall be established for research and development costs related to developing new coal and activated carbon products in the province.
•Property Rights and Renewable Energy: Boundary issues and property owners’ rights, including wind wake issues, shall be addressed. Municipalities shall be granted the right to veto the establishment of wind turbine and solar facilities within their jurisdiction or place reasonable restrictions on their location.
•Ending SaskPower’s Monopoly: Legislation shall be introduced to end SaskPower’s monopoly, allowing for private sector power production and experimentation with clean coal technology.
•Mine Remediation Rules: A public review and consultations on mine remediation rules, including the required dollar value of reclamation bonds, clean-up cost estimates, and alternative funding mechanisms such as assigned trusts, shall be held every four years.
•Tax Deduction for Retraining Costs: A tax deduction for retraining costs, up to $10,000, shall be offered to workers and their spouses in industries directly threatened by federal energy and environmental legislation.
•Tax Credit for CCS Investments: The tax credit for eligible investments shall be increased to 50% to support carbon capture and storage (CCS) and increased energy production in the province.
•PST Exemption for CO2 Utilization: A tax incentive in the form of a PST exemption shall be provided for carbon dioxide used in enhanced oil recovery through tertiary recovery of oil and natural gas.
•Opposition to Federal Carbon Regulations: The Saskatchewan government shall use all legal means to oppose federal regulations limiting carbon emissions, requiring CO2 capture or containment at power plants, or imposing a carbon tax.
•Support for Pipeline Infrastructure: Legislation shall support the construction of pipelines and other necessary pipeline infrastructure projects.
•Review of Energy Industry Regulations: A comprehensive review of energy industry regulations shall be undertaken to simplify, streamline, or eliminate unnecessary regulations and reduce the cost of permits.
•Corporate Income Tax Incentive for Upgraders and Refineries: Legislation shall be introduced to provide a corporate income tax incentive for start-up upgraders and refineries in Saskatchewan.
•Differentiated Electricity Pricing: SaskPower shall implement differentiated pricing for electricity based on the source and reflecting the life-cycle cost (LCC) of that source.
•Update of Petroleum and Natural Gas Directives: Petroleum and Natural Gas Directives 033 and 045 shall be updated to encourage on-site remediation of mild to moderate salinity-impacted sites.
•Remediation Rules for Renewable Energy: New remediation and reclamation rules for renewable energy (wind and solar) shall be created, comparable but relevant to the infrastructure used for end-of-life upstream oil and gas sites.
“The other part of our energy platform is we have already passed policy that we will refurbish and give all of the power plants in Saskatchewan another 30 years of life, which will create good jobs for the people of Saskatchewan.”
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