October 2007 Market Research

[BMironov]

Statistics Canada (Oct 19, 2007):http://www.statcan.ca/Daily/English/071019/d071019.pdf
Consumer Price Index
http://www.statcan.ca/Daily/English/071019/d071019a.htm

QUOTE The Bank of Canada`s core index, used to monitor the inflation control target, rose by 2.0% between September 2006 and September 2007, a deceleration from the rate of 2.2% posted in August 2007. This was the lowest rate of growth in the core CPI since August 2006.

12-month change: Higher gasoline prices exert strong upward pressure
Gasoline prices were the main factor behind the 2.5% climb in consumer prices between September 2006 and September 2007.

Owned accommodation cost also pushed up the 12-month change in the CPI in September, rising 4.8%. Homeowner`s replacement cost, which represents the worn-out structural portion of housing, and mortgage interest cost were the primary drivers of the increase in costs to Canadian homeowners.
Over time, mortgage interest cost has become an increasingly important driver of the overall change in owned accommodation. Between September 2006 and September 2007, mortgage interest cost rose by 6.4%, compared with 6.1% in August. This is the highest rate of growth since June 1991.
Homeowners` replacement costs were 5.2% higher in September than they were a year earlier. However, this component`s contribution to owned accommodation has been tapering off.
Housing costs also accelerated, due to a 2.1% increase in the price of electricity and a 9.0% rise in the price of water.

TD Economics comments:
http://www.td.com/economics/comment/rs101907.pdf

 

[BMironov]

Statisitcs Canada:Current economic conditions (Oct 19, 2007)
http://www.statcan.ca/Daily/English/071019/d071019b.htm

QUOTE The Canadian dollar capped its five-year appreciation against the US dollar by achieving parity late in September. The increase accompanied higher commodity prices, notably record prices for oil and wheat, and a cut in US interest rates. The latter was motivated by the turmoil in financial markets that began in mid-August, and renewed weakness in the US housing market.

In Canada, however, there were few signs that the disruption in some financial markets (notably asset-backed commercial paper) was affecting the real economy. Most importantly, employment jumped 0.3% in September, helping to send the unemployment rate to a 31-year low of 5.9%. Higher commodity and stock market prices in September also pointed to the underlying strength of the economy. Short-term business credit growth was steady, as more bank loans made up for a drop in commercial paper.

The Consumer Price Index fell 0.1% between July and August, largely due to lower gasoline prices. As a result, the annual inflation rate slowed substantially to 1.7% from the 2.2% posted in each of the previous four months.
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gasoline prices in Canada fell 7.7%, more than the 4.9% drop in the US. This continues a trend that began when the loonie began its appreciation in 2003: since then, gasoline prices have risen 42% in Canada, while US drivers have seen prices jump 90%.
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British Columbia`s resource sector continued to hamper growth. In particular, its forestry products, which account for one-third of its shipments, were hit by a province-wide strike late in July. This was the latest blow to the lumber industry, which has seen shipments tumble 22% in a little over a year. Still, British Columbia`s overall employment growth of 2.9% in the past year remained the third highest among the provinces, led by construction. This helped buoy housing starts and retail sales over the summer.

Ontario also continued to shift away from its traditional manufacturing base. It has shed 60,000 factory jobs in the past year. Nevertheless, employment growth has remained close to the national average due to services. Business services led the way with gains of nearly 10%. Education and accommodation and food have also seen employment grow at double-digit rates. Housing starts remained steady into August, but Ontario retail sales in July were the weakest in Canada.

 

[BMironov]

Statistics Canada:Large urban transit (Oct 19, 2007)
http://www.statcan.ca/Daily/English/071019/d071019e.htm

QUOTE Combined ridership on 10 large urban transit systems in Canada was 5.1% higher in August than it was for the same month in 2006.

Approximately 100.8 million passenger trips were taken on these transit systems in August. These systems account for about 80% of total urban transit in Canada.

The trips generated $174.2 million in revenue in August (excluding subsidies), a 4.9% increase over August 2006.


Aircraft movement statistics (Oct 19, 2007)
http://www.statcan.ca/Daily/English/071019/d071019f.htm

QUOTE The 42 Canadian airports with NAV CANADA air traffic control towers reported 443,944 aircraft take-offs and landings in September, up 10.8% compared with September 2006 (400,522 movements). This marked the 16th consecutive increase in year-over-year monthly comparisons. Year-over-year increases in aircraft movements were reported by 32 of these airports in September. The variations ranged from an increase of 88.8% for Gander International to a decline of 22.7% for Boundary Bay.

 

[BMironov]

Financial Post:Bank of Canada will hold rates through 2009 (Oct 19, 2007)
http://www.canada.com/nationalpost/financi...79-5532765c4996

QUOTE A strong currency, a weak U.S. economy and credit tightening has the Bank of Canada projecting no change in interest rates through 2009, and further warning its economic forecast is subject to a "slight tilt" to the downside.The bank`s analysis, in this quarter`s monetary policy report released yesterday, includes a downward revision in economic growth for the period through 2009, as exports are expected to exert a "significant drag" on the economy. Furthermore, it forecasts that investment in housing will drop and companies will postpone spending on equipment due to higher borrowing costs attributed to the fallout from the U.S. subprime-mortgage market meltdown.

These factors are expected to push inflation down toward the central bank`s 2% target next year, faster than anticipated.

The latest Bank of Canada forecast, which looks at the period to Dec. 31, 2009, paints a portrait of the Canadian economy as a juggler, dealing with balls representing both downward pressures -- a Canadian currency worth more than US$1, increased borrowing costs and tepid U.S. growth -- and an inflationary push in the form of strong domestic demand.
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As a result, the central bank has revised its forecast slightly downward, with the economy expected to grow 2.6% this year, 2.3% in 2008 and 2.5% in 2009.

Bank of Canada press release:
http://www.bank-banque-canada.ca/en/press/2007/pr07-29.html


Financial Post:
Bank of Canada forecast seen as unusually explicit (Oct 19, 2007)
http://www.canada.com/nationalpost/financi...2d-bfe514b652b3

QUOTE The Bank of Canada appears to have taken its drive for transparency to new heights.

In an unusual move, the bank laid out where it sees interest rates going, assuming all the moving parts of the economy perform to its assumptions: nowhere.

"In this base-case projection, there is no change in the policy interest rate," the bank said.
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"Therefore, the bank appears to be sending an unusually clear signal that it neither intends to hike, nor cut rates for the duration of its forecast period, which extends to 2009."

TD Economics comment:
http://www.td.com/economics/comment/bc101807.pdf

 

[BMironov]

Financial Post:Bankruptcy looms: experts (Oct 19, 2007)
http://www.canada.com/nationalpost/financi...9c-288ed78658ad

Only Months Away

QUOTE As the forestry industry struggles to cope with currency woes and awful commodities pricing, industry observers say a growing number of companies may not emerge from the current downturn.

The first is likely to be Pope & Talbot Inc., a U.S. company with numerous Canadian assets that is effectively broke. It has spent months unsuccessfully trying to sell off assets, and this week announced a third credit extension, this one for just 10 days. Inside its Harmac pulp mill on Vancouver Island, workers have begun to flee under an expectation that sometime in the next week it will either go belly up or be sold.
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Others at slightly less imminent risk include Tembec Inc., Ainsworth Lumber Co. Ltd. and Fraser Papers Inc. --all companies that, like Pope & Talbot, have spent recent months shutting down mills at a frenzied pace as losses pile up and share prices tumble.

While some -- including the companies themselves -- believe they have the resources to avoid bankruptcy or severe restructuring, Salman Partners analyst Paul Quinn, using second-quarter results, calculated that Tembec has 15 months to live, Fraser Papers has a year and Ainsworth could founder in 21 months.
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"It`s not saving you. It`s kind of like you`re living out in the middle of nowhere and you`ve run out of firewood, so you`re breaking your chairs and you`re using those for heat. Next you`re going to take apart your house because you`re running out of things to sell," he said. "But it`s still damn cold outside."

The problem, said PricewaterhouseCoopers forest and paper specialist Craig Campbell, is that companies buoyed last year by softwood lumber refunds have now exhausted that cash.

 

[BMironov]

The Record:Feds to put up to $40 million toward Ottawa-area highway improvements (Oct 19, 2007)
http://news.therecord.com/Wire/News_Wire/N.../article/258318

QUOTE The Tory government says it`s willing to put as much as $40 million toward highway improvements in east-end Ottawa.

Transport Minister Lawrence Cannon says widening a 22-kilometre stretch of Highway 174 and Country Road 17 is a priority because of the traffic bottleneck in that portion of the capital.

The overall project cost is estimated to be $104 million.
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The provincial government has set aside $40 million, but a formal funding agreement has yet to be struck with the city.

The Conservatives have set aside $33 billion for infrastructure improvements throughout the country.

 

[BMironov]

The Hamilton Spectator:Rental vacancies shrink (Oct 18, 2007)
http://www.thespec.com/News/Business/article/268160

Landlords benefit from credit crunch, high home prices

QUOTE Apartment real estate investment trusts (REITs) are expecting solid revenues for the rest of the year as high home prices and financing difficulties keep unit vacancies at all-time lows and allow landlords to raise prices."We`ve been in this business for 10 years and we have never seen as few vacancies as we are seeing now," said Michael Newman, chief executive of InterRent Real Estate Investment Trust.



"A lot of it does have to do with affordability of housing and people just not feeling comfortable making an investment when the economy seems to be somewhat unbalanced."
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Some would-be home buyers are also finding it more difficult to get financing and carry a mortgage, as the so-called "credit crunch" is leading to higher mortgage rates for some buyers, as well as less availability those deemed risky.

Those issues have led to a decline in vacancies for InterRent over the last six months, while Calgary-based Boardwalk Real Estate Investment Trust, Canada`s largest owner-operator of multifamily rental communities, said its revenues have grown by more than 10 per cent so far this year.

Both REITs say they also been able to raise unit prices on turnover at higher rates than they would have in the past.

"It`s cyclical, you`re going to be in this type of cycle -- not for an extended period of time -- but it`s going to have an effect for the next two or three years," InterRent`s Newman said.

 

[BMironov]

CIBC World Markets:Oil Prices? Let`s Talk Turkey (Oct 19, 2007)
http://research.cibcwm.com/economic_public...ad/oct19_07.pdf

... blaming Turkey, the dollar or speculators for oil price hikes misses the larger story."

QUOTE Speculators did indeed build long positions in the futures market, and WTI got atypically high relative to Brent. But speculators only win if, in the end, fi nal consumers are there to buy the refi ned products at higher prices. Why would these investors believe that to be the case?

It all comes back to ECO 100. Oil prices are sensitive to threats of supply shocks because the world market for crude is tight. Rapid consumption growth in the developing world, and in oil producing countries, has left little slack, so that if an Iraqi fi eld goes down, or platforms in the Gulf of Mexico are damaged by hurricanes, there`s no quick substitute.

Oil will remain volatile, and the steepest peaks will be temporarily followed by subsequent valleys. But there`s no mistaking the permanence of the underlying trend. Until global growth is itself tamed, blaming Turkey, the dollar or speculators for oil price hikes misses the larger story.

 

[BMironov]

Barrie Advance:Citizens to advise on Lake Simcoe spending (Oct 17, 2007)
http://www.barrieadvance.com/barrieadvance/article/50331

Federal Environment Minister John Baird announced a committee of local residents last week that will recommend how Ottawa should spend $12 million to improve Lake Simcoe’s health.

QUOTE The new residents’ group has been dubbed the Protect and Preserve the Environment of Lake Simcoe (PROPEL) committee.

“The valuable work of this committee will complement the government’s work to ensure that the cleanup and protection of Lake Simcoe continues to move forward,” Baird said while visiting Jackson’s Point on Lake Simcoe’s south-east shore.
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The $12 million allotted to help clean up Lake Simcoe is a portion of the nearly $93 million earmarked as part of the federal government’s national water strategy.
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Van Loan said the lake is of vital importance to the area’s tourism economy, environment and quality of life. The announcement, Van Loan added, shows the Conservative government’s willingness to take public input when planning.
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“I’m hoping we can get started almost immediately so that we can roll up our sleeves and get started,” Ms Hackson said. “We’re just waiting for directions and I understand (PROPEL) will assess some projects and let us know where to begin.”

 

[BMironov]

Globe and Mail:Former WestJet bosses hatch NewAir (Oct 22, 2007)
http://www.reportonbusiness.com/servlet/st...ry/robNews/home

QUOTE Four former WestJet Airlines Ltd. executives, led by co-founder Tim Morgan, are drawing up plans to launch a new Canadian carrier.
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Using the name NewAir & Tours, the business model is still being fleshed out, but the goal is to fly travellers in smaller cities to larger centres and U.S. holiday destinations.
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Calgary-based NewAir believes it will carve a niche by pursuing routes either neglected or underserved by WestJet and Air Canada.
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Mr. Morgan, former WestJet executive vice-president of operations, is spearheading the plan with William Lamberton, former vice-president of marketing. They are being supported by Gareth Davies, former vice-president of technical services, and Alan Mann, a former WestJet accounting executive.
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Sources say NewAir`s offerings could include charter flights with a seasonal schedule. For instance, there may be weekly non-stop service from Fort McMurray, Alta., to Vancouver for part of the summer, and that could switch to Fort McMurray to Reno, Nev., in the winter. Consumers could choose to bundle flights with hotel rooms and, in some cases, tour packages.
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Porter Airlines Inc., which celebrates its first anniversary tomorrow, currently flies from its base at Toronto`s island airport to Montreal, Ottawa and Halifax. Porter hopes to expand within four years to smaller Ontario sites such as Sault Ste. Marie and Sudbury – two cities that would also fit NewAir`s target market.

 

[BMironov]

TD Economics:Provincial Economic Outlook (Oct 22, 2007)
http://www.td.com/economics/qef/prov1007.pdf

A LEAN YEAR FOR PROVINCIAL ECONOMIES IN 2008

QUOTE This edition of TD’s Provincial Economic Outlook provides a less sanguine view of prospects for 2008 than that issued in the spring. At that time, we had forecast national average growth of just under 3% next year, as a long-awaited recovery in central Canada and some improvement in Atlantic Canada would more than offset a simmering down in Alberta’s rate of expansion. Moderately cooler conditions are indeed becoming evident in the Alberta economy, as anticipated. But the further run-up in the Canadian dollar and a modest downgrading in our U.S. growth outlook have led us to shave about half a percentage point – on average – to 2008 growth performances in most parts of the country. Furthermore, 2009 is shaping up to be another sub-2.5% performance in about half the provinces, including Ontario and Quebec.

 

[BMironov]

CIBC World Markets:Fueling inflation (Oct 22, 2007)
http://research.cibcwm.com/economic_public...load/soct07.pdf

"With food carrying more than twice the weight in the CPI than energy, the policy response to record oil prices may become more inflationary than oil prices themselves."

QUOTE If energy prices haven`t gotten your attention then surely food prices have, where inflation is already running well above 4%. The coincident surges in food and energy price inflation are not unrelated. The massive policy-mandated diversion of the American corn crop from animal feed and human consumption to ethanol production has already led to huge distortions in agricultural prices, and threatens even greater distortions as land use patterns continue to change.

Table of content:[list type=decimal][*] Corn For Ethanol: An Inflation Crop

• Surging Ethanol Production
• The Subsidy
• And for What?
• Food Inflation Canada`s Contemporary Class Struggle
  Resource Producers Remain in the Driver`s Seat
  Canadians Vote with Their Feet
  Alberta Demand No Substitute for US
  Premium C$, $100 Oil Weigh on Central Canada

[/list type=decimal]

 

[BMironov]

Globe and Mail:CMHC urges greener homes in denser urban areas (Oct 22, 2007)
http://www.globeinvestor.com/servlet/story...port22/GIStory/

QUOTE Most of Canada`s population growth is taking place on the outskirts of major cities, with outlying urban areas up 11.1 per cent in the five-year period from 2001 to 2006 compared with 4.2 per cent for bigger cities.

In 2006, 81 per cent of Canadians lived in centres of 10,000 or more, compared with 80 per cent in 2001, an increase of 1.6 million people in five years.

The fastest growing metropolitan areas from 2001 to 2006 were Barrie, Ont., Calgary, Oshawa, Ont., and Edmonton, while the fastest-growing small towns were mainly located around Vancouver, Toronto and Montreal.
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Other findings in the report: - The number of Canadians living in housing that falls below adequacy, suitability or affordability standards, has dropped slightly. In 2004, 13.6 per cent of the population lived in such housing, a small decline from 13.9 per cent in 2002; - Housing-related spending increased by 6.1 per cent in 2006, contributing $275-billion to the Canadian economy. But debt is also on the rise, with total outstanding mortgage credit hitting $694-billion last year, up 10.7 per cent from 2005; - Increased equity in real estate helped fuel an increase of more than 4 per cent in the average net worth of Canadian households in the years from 1999 to 2006. The number of households in Canada that owned a second home or cottage hit 1.1 million in 2006, up 200,000 from 1999.

CMHC report "Canadian Housing Observer 2007":
http://www.cmhc-schl.gc.ca/odpub/pdf/65704.pdf

 

[BMironov]

Financial Post:CMHC spurs investors (Oct 25, 2007)
http://www.canada.com/nationalpost/financi...ff-0e4e1acb280e

Risky Territory?; Insurer`s change aimed at raising rental supply

QUOTE The Crown corporation, which controls about 70% of the mortgage insurance market in Canada, has quietly introduced changes that lower the down-payment threshold for an investment property. Instead of needing 15% down, Canadians will be able to buy a second property -- not to mention a third and fourth and fifth -- with no money down.

"These enhancements will ensure continued supply of affordable rental accommodations across Canada," said Pierre Serre, vice-president of insurance products with CMHC.
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None of CMHC`s competitors are coming close to this new offer. Genworth Financial Canada -- the other dominant player with about 30% of the mortgage insurance market -- requires investors to have at least 10% down.
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The real reason for the new program, suggest some commentators, is CMHC trying to fend off competitors in the marketplace. In a constant battle with Genworth, CMHC is also facing up to four new mortgage insurers who have applied to do business in Canada or are already licenced to do so.
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CIBC World Markets senior economist Benjamin Tal said the latest changes by CMHC are probably just the beginning. "The genie is out of the bottle, this mortgage market is starting to move. Over the past 16 months we`ve seen more changes than the past 30 years," said Mr. Tal.
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OTHER MOVERS - The number of insurance providers has mushroomed with AIG United Guaranty, Triad Guaranty Insurance Corp. Canada and PMI Mortgage Insurance Co. Canada joining CMHC and Genworth Financial Canada in the fight for premiums.

 

[BMironov]

Statistics Canada (Oct 26, 2007):Sawmills
http://www.statcan.ca/Daily/English/071026/d071026e.htm

QUOTE Monthly lumber production by sawmills edged down 1.6% to 5 708.1 thousand cubic metres in August.

In August, sawmills shipped 5 910.7 thousand cubic metres of lumber, a decrease of 4.1% from July. Compared with August 2006, lumber shipments fell 8.9%.

Between July and August, stocks dropped 3.1% to 7 854.8 thousand cubic metres.

If you wonder what is happening with tobacco inductry in Canada:
QUOTE Total cigarettes sold in September by Canadian manufacturers decreased 14.6% from August to 1.3 billion cigarettes, down 20.6% compared with September 2006.

Cigarette production in September decreased 11.8% from August to 1.4 billion cigarettes, down 25.7% from September 2006.

 

[BMironov]

CIBC World Markets:Provincial Forecast: Canada’s Contemporary Class Struggle (Oct 26, 2007)
http://research.cibcwm.com/economic_public...oad/pfoct07.pdf

“At its most basic, Canada’s struggle pits resource producers against non-resource manufacturers ...”

It is so packed with information that I would have to copy whole document.

QUOTE At its most basic, Canada’s struggle pits resource producers against non-resource manufacturers; the former capitalizing on a global economic boom, the latter victim to a premium exchange rate, a slumping US, and competition from overseas players (whose very success, in a cruel twist of irony, is behind so much of the demand for Canada’s resources).

• Resource Producers Remain in the Driver’s Seat
• Canadians Vote with Their Feet
  Alberta Demand No Substitute for US
  Premium C$, $100 Oil Weigh on Central Canada

 

[BMironov]

CIBC World MarketsMore and Better Jobs (Oct 29, 2007)
http://research.cibcwm.com/economic_public...da-20071029.pdf

QUOTE Our employment quality index, which combines information on the distribution of part-time vs. full-time jobs; self-employment vs. paid employment; and the compensation ranking of full-time paid employment jobs in more than 100 industry groups, rose by 3.8% during the first nine months of the year, and it is now at its highest level in more than two years (Chart 1). And the combination of rising employment and improving quality is a sure recipe for rising personal income, which during the first half of the year, rose by more than 8% on an annualized basis.

Note that the experience in Canada is very different than the situation in the US where the quality of employment fell by 1.5% since the beginning of the year, and it is now almost 13% below the level seen earlier in the decade (Chart 2). It seems that in Canada the loss of manufacturing jobs is being offset by job gains in sectors with equivalent and higher employment quality. That’s not the case in the US where the jobs now being lost in sectors such as construction/real estate and manufacturing are being replaced by lower quality jobs.

Interestingly, the improvement in the index was not due to a strong rise in paidemployment. In fact, during the first nine months of the year, self-employment rose four times faster than paid employment (Chart 3). And given that on average, selfemployed earn less than 80% the income of paid employees, this trend is negative from a quality perspective.

Great 4-page report by Benjamin Tal​

 

[BMironov]

If you prefer newspapers. Last post about CIBC World Market report discussed in Globe and Mail:Canada creating better jobs (Oct 29, 2007)
http://www.reportonbusiness.com/servlet/st...ry/robNews/home

QUOTE Canada`s economy is churning out not only more but also better jobs, with layoffs in manufacturing being offset by the creation of high-quality work in other sectors, a Canadian Imperial Bank of Commerce report released Monday said.
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In the first nine months of the year, CIBC`s employment quality index — which measures the value of the jobs created by compensation and stability — climbed 3.8 per cent to its highest level in more than two years.
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The improvement in job quality comes amid the well-documented woes of Canada`s manufacturing industry. Pummelled by the soaring Canadian dollar, many manufacturers have been forced to cut jobs, leaving thousands of people out of work, many of them in Ontario.

However, Benjamin Tal, a CIBC economist and author of the report, said in Canada “the loss of manufacturing jobs is being offset by job gains in sectors with equivalent and higher employment quality.”
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According to Mr. Tal, the Canadian combination of employment growth and improving job quality is “a sure recipe” for rising personal income, which increased by more than 8 per cent in the first half of the year.Furthermore, the combination will give Bank of Canada Governor David Dodge even more reason to stay on the sidelines when it comes to interest rates. “If the Bank of Canada needs another justification for keeping interest rates unchanged in an environment of falling U.S. rates, it can point to an improving employment quality in Canada,” Mr. Tal said.

 

[BMironov]

Vancouver Sun:B.C. mills` owner seeks bankruptcy protection (Oct 30, 2007)
http://www.canada.com/vancouversun/news/bu...e4-175ce3559745

Pope & Talbot move will deepen crisis for rivals, analyst predicts

QUOTE A United States forest company with most of its mills and 1,700 employees in B.C. filed for bankruptcy protection Monday, marking the first major corporate failure in what many say is the industry`s worst downturn in memory.
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Kevin Mason of Equity Research Associates said while Pope & Talbot is under bankruptcy protection, it will only deepen the financial crisis for its competitors in this province.
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Companies under creditor protection usually keep running for whatever cash flow they can generate when, under other circumstances, they would shut down. Pope & Talbot has said it intends to keep operating.
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Three of Pope & Talbot`s four B.C. sawmills are currently shut down temporarily. Its two pulp mills are operating although one, at Harmac near Nanaimo, is only running two of its three production lines.
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Besides its sawmills, Pope & Talbot`s most fragile asset is its Harmac pulp mill near Nanaimo, Quinn said. The mill, which employs more than 500, has a costly fibre supply and is experiencing fibre shortages because of the lengthy forestry strike, settled only last week. The company`s Mackenzie pulp mill has lower fibre costs, Quinn said.

Pulp markets are currently strong, but that`s not the case for lumber, Quinn said. When inflation is taken into account, lumber is trading below its bottom price during the recession of the early 1980s, a time when countless B.C. sawmills shut down.

 

[BMironov]

Globe and Mail:Alberta talks up new rules on U.S. trip (Oct 30, 2007)
http://www.theglobeandmail.com/servlet/sto...PStory/Business

QUOTE Alberta Energy Minister Mel Knight has promised to review the province`s new oil and gas royalties every five years as he began a U.S. trip aimed at allaying fears the higher rates will kill the investment boom.

"We want to have an opportunity to look in five-year bites to see how we`re sitting in terms of the economy and pricing," Mr. Knight told reporters in Washington after meeting yesterday with officials at the White House as well as the U.S. State and Energy departments.
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"We feel this is a very solid and robust framework that ... will last at least a decade, and perhaps longer," he told reporters at the Canadian embassy in Washington.
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About 49 per cent of Alberta`s oil sands production is covered by separate agreements that won`t be covered by the new regime.