Alberta Premier Peter Lougheed's tactic of cutting oil shipments...

OTTAWA -- Alberta Premier Peter Lougheed's tactic of cutting oil shipments to eastern Canada is not villainous, but a sensible decision, said Conservative economic critic Harvie Andre.

Federal Energy Minister Marc Lalonde, who meets with Alberta Energy Minister Merv Leitch Wednesday, should give in and pay Alberta $35 to $40 a barrel for oil, the Alberta MP said in a weekend Standard Broadcast News interview.


The world price for oil now ranges from $40 to $43 a barrel, but the producing province has been paid less than $18.

Andre defended Alberta's oil cuts, saying they became 'inevitable' when the federal government refused to pay substantially more for a diminishing resource.

'Why am I such a villain to say, look, this stuff I'm selling at $17.75, perhaps I should not sell it quite so quickly, and hold it back,' Andre said. 'It's not a weapon I'm sure that Alberta likes to use. ... They would prefer obviously an agreement and working things out.

'But it's the only thing they have left ... that they either have a choice of selling it now at fire-sale prices or holding some back,' he said.

Alberta has promised the cutbacks, now totaling 120,000 barrels a day, would be rolled back if there were a real danger they would create shortages in Canada, Andre said.


Any 'prudent individual' would also protect his resources and expect 'full value for them,' the Tory MP added. 'I think they've (Alberta) acted reasonably responsibly.'

Lougheed imposed the oil cuts in two stages on March 1 and June 1 to protest the federal government's national energy program and its refusal to pay what he considered 'a fair price' for the oil.

A third and final 60,000-barrel a day cut was set for Sept. 1 unless an energy-pricing agreement could be reached by then.

Lalonde and Alberta Energy Minister Merv Leitch were to meet in Banff, Alta., on Wednesday for the latest round of pricing talks. Neither man has expressed optimisim there could be an quick settlement, and Lalonde has said several meetings were still needed.

Andre said the whole problem of the oil cuts would never have emerged under a Conservative government. If a Tory agreement with Alberta on pricing had gone through last year, he said, the industry and exploration would be 'going at a good clip.'

'We wouldn't be losing billions of dollars to the United States and the hundreds of rigs and untold manpower,' he said.

Conservative leader Joe Clark has said he was only days away from reaching an oil pricing agreement with Alberta when his government's budget was defeated in December 1979.


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