It’s time to recognize we are living in a new world after the fall of the Soviet Union and especially 9/11.

That’s the mantra being chanted by many energy industry experts these days. And perhaps the most cogent, if controversial, view of what this really means comes from Paul Michael Wihbey, president of Washington, D.C.- based GWEST (Global Water & Energy Strategy Team.)

Some pretty important people are listening to Wihbey, from Calgary-based First Energy – which featured his ideas in a recent company newsletter – to the Daily Oil Bulletin and even members of the U.S. Congress. Calgarians will have a chance to hear him in person at the end of June.

Wihbey is a keen observer of disruptive factors such as the war in Iraq and “palace intrigue in the House of Saud,” and he attributes a significant component of the current price of oil to what he calls the “geopolitical premium.”

Paul Wihbey

He also thinks that Canada is very well positioned to benefit from this, as part of an emerging continental grid system anchored on energy. He predicts that “Canada, Mexico and the United States will come much closer together over the next several years, and this is part of the transition from the old order of the Cold War and post-Cold War period into a new global system.”

Wihbey feels that Canada has tremendous advantages because of its significant reserves and low political risk compared to other oil-producing countries.

He also believes we should be selling freshwater to the United States. He jokes that “Canada already exports a significant amount of water in beer and bottled water” but he’s talking about bulk sales, which are potentially very lucrative, as well as politically super- sensitive.

Canadian blood boils at the very thought of us going thirsty, or paying a lot for freshwater, while some yahoo in Arizona exercises his NAFTA-given right to water his lawn. Not a problem, says Wihbey. He predicts that we’ll be able to come to a contractual agreement that allows fresh water to be sold to the U.S. for a period of 10 or 20 years, with the right to turn off the tap at the end of the contract.

That might not be as easy as it sounds. If we have learned anything from the war in Iraq, it’s how the U.S. behaves when its back is against the wall. Wihbey himself notes that whole parts of the U.S. are drying up – 100 farms a year in Arizona are being shut down for lack of water. Uncle Sam is getting thirsty and Canadian water looks real good.

Wihbey describes the ill-fated deal between Sunbelt, a California-based company, and the province of British Columbia. The plan was to ship B.C. water to California in tankers, but a change in the B.C. government resulted in the cancellation of the deal. Sunbelt is now suing the Canadian government under a provision of NAFTA.

There were also attempts to sell water from Newfoundland to the New England market that were halted by the Canadian government. Then there were the fanciful attempts to tow a Canadian iceberg down to the thirsty U.S. According to Wihbey, “there isn’t really any legal or constitutional prohibition against the sale of freshwater to the United States.”

He calls for a national water policy for Canada, but when told what that would conjure up in Western Canada, quickly agrees he’ll need to find a better name for it before coming to Calgary.

How will NAFTA work into all this? Wihbey says that “NAFTA needs to be reinforced in terms of these emerging continental conditions in terms of energy and water. What we would like to see is a free market operating between the countries, subject to political decisions, and that has already happened in equity markets and energy, through pipes and mergers and acquisitions and capital flows.” He says that water fits into this framework very well, because “the infrastructure grid for water parallels the one for oil.”

Wihbey also has some very controversial views on oil and gas. For example, he says, “I’m not a very big fan of the Hubbert Peak.” That’s the theory put forward by U.S. petroleum geologist M. King Hubbert in 1956. It stated that with global energy demand increasing and oilfields being depleted, we’ll hit a crisis point in oil supply sometime after 2010, and somewhere between 2020 and 2030 for natural gas. Even throwing in unconventional sources such as the Alberta tar- sands only pushes the number back by a few decades at most.

Wihbey says he’s fascinated by the Russian approach to oil exploration and production. “The Russians have been around a long time when it comes to oil extraction, and we in the West tend to underestimate their approach and they prove us wrong.”

He notes some Russian experts view oil not as a fossil fuel, but as a derivative of methane, and they feel that there are vast reserves bubbling up from deep within the earth. Some even believe that oil is regenerative, and is being made continuously. So the Russians drill very deep – and in Wihbey’s view, they’re on to something.

Wihbey believes it’s time to fundamentally change our mindset to a continental perspective. “We need to rethink Canada’s role in security, defence, the energy grid system and other commodities like water,” he says. “Canada is the fifth-ranked energy superpower in the world, after the U.S., China, Russia and Saudi Arabia. I think the future is very bright for Canada in terms of oil and natural gas.”

Paul Wihbey is just one of the topnotch speakers scheduled to address the upcoming International Trade & Technology Summit being held in Calgary, June 23 to 25.

With the urgency of some of these issues, and gurus like Paul Wihbey speaking, this could be a conference that goes down in energy industry history as a landmark event.

(Tom Keenan is a professor at the University of Calgary and an expert on technology and its social implications. He can be reached at keenan@businessedge.ca)