Trump’s plans should prompt Ottawa to reverse damaging policies aimed at oil and gas

Adding to a long list of costly federal policies that restrict oil and gas development, the Trudeau government plans to cap greenhouse gas emissions from the oil and gas sector at 35 per cent below 2019 levels by 2030. This is the exact opposite of what Canada needs, particularly given developments south of the border.

President-elect Donald Trump has made it clear he aims to boost U.S. oil and gas production. Pledging to “drill, drill, drill,” Trump will lift restrictions on liquified natural gas exports, expedite drilling permits, and expand offshore oil production through new lease sales. He also plans to create a National Energy Council to establish U.S. “energy dominance” by “cutting red tape, enhancing private sector investments across all sectors of the economy, and by focusing on innovation over long-standing, but totally unnecessary, regulation.” These changes will lower the cost of oil and gas development in the U.S., which means production will increase and commodity (e.g. crude oil) prices will likely drop in the U.S., Canada and beyond.

Of course, this might lower prices at the pump, lower home-heating bills and bring good news for consumers. But policymakers should understand that lower commodity prices would be a big hit for provincial budgets in Alberta, Saskatchewan and Newfoundland and Labrador, which rely heavily on resource revenues. In Alberta, for example, a $1 decline in the price of oil results in an estimated $630 million loss to the provincial treasury. The federal government will also take a hit. In 2022 (the latest year of available data), Canada’s oil and gas industry paid the federal government more than $9 billion in corporate income taxes.

And because the Trudeau government has introduced numerous new regulations that restrict oil and gas development, it would be very difficult for the industry to increase sales volume to offset any loss. And according to a recent report by Deloitte, the government’s proposed emissions cap will curtail oil production by 626,000 barrels per day by 2030 or by approximately 10.0 per cent of the expected production—and curtail gas production by approximately 12.0 per cent.

There’s also Bill C-69 (the “Federal Impact Assessment Act”), which overhauled Canada’s federal environmental review process making the regulatory system more complex, uncertain and subjective. And Bill C-48, which bans large oil tankers off British Columbia’s northern coast, presenting another barrier to exporting to Asia. All of these policies make Canada, and particularly energy-producing provinces such as Alberta, Saskatchewan and Newfoundland and Labrador, less attractive for investment.

Indeed, according to the latest survey of oil and gas investors published by the Fraser Institute, 50 per cent of survey respondents said the “stability, consistency and timeliness of environmental regulatory process” in Alberta scared away investment compared to only 11 per cent in Texas. Similarly, 42 per cent of respondents said “uncertainty regarding the administration, interpretation, stability, or enforcement of existing regulations” was a deterrent to investment in Alberta compared to 13 per cent in Texas. And 43 per cent of respondents said the cost of regulatory compliance was a deterrent to investment in Alberta compared to 19 per cent for Texas. Without strong investment, energy-producing provinces won’t be able to increase production.

Trump’s plan to reduce regulations and bolster U.S. oil and gas production will lead to lower prices for oil and gas. While that’s good news for consumers, policymakers should understand how the new normal will impact government coffers. To offset the loss associated with lower prices and lower revenue, provinces need more natural resource development. But that will require the Trudeau government to reverse its damaging policies and abandon its emissions cap plan.

Tegan Hill

Director, Alberta Policy, Fraser Institute

Related Topics:#FraserInstitute #LNG #TeganHill CanadaEnergyPolicy CanadaUSOilAndGas DrillBabyDrill PresidentElectTrump

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Canadian Energy Centre / 9 hours ago

Cross-Canada economic benefits of the proposed Northern Gateway Pipeline project

Alberta / 9 hours ago

Albertans need clarity on prime minister’s incoherent energy policy

Canadian Energy Centre

Cross-Canada economic benefits of the proposed Northern Gateway Pipeline project

Published on June 15, 2025

Todayville

From the Canadian Energy Centre

Billions in government revenue and thousands of jobs across provinces

Announced in 2006, the Northern Gateway project would have built twin pipelines between Bruderheim, Alta. and a marine terminal at Kitimat, B.C.

One pipeline would export 525,000 barrels per day of heavy oil from Alberta to tidewater markets. The other would import 193,000 barrels per day of condensate to Alberta to dilute heavy oil for pipeline transportation.

The project would have generated significant economic benefits across Canada.

The following projections are drawn from the report Public Interest Benefits of the Northern Gateway Project (Wright Mansell Research Ltd., July 2012), which was submitted as reply evidence during the regulatory process.

Financial figures have been adjusted to 2025 dollars using the Bank of Canada’s Inflation Calculator, with $1.00 in 2012 equivalent to $1.34 in 2025.

Total Government Revenue by Region

Between 2019 and 2048, a period encompassing both construction and operations, the Northern Gateway project was projected to generate the following total government revenues by region (direct, indirect and induced):

British Columbia

Provincial government revenue: $11.5 billion
Federal government revenue: $8.9 billion
Total: $20.4 billion

Alberta

Provincial government revenue: $49.4 billion
Federal government revenue: $41.5 billion
Total: $90.9 billion

Ontario

Provincial government revenue: $1.7 billion
Federal government revenue: $2.7 billion
Total: $4.4 billion

Quebec

Provincial government revenue: $746 million
Federal government revenue: $541 million
Total: $1.29 billion

Saskatchewan

Provincial government revenue: $6.9 billion
Federal government revenue: $4.4 billion
Total: $11.3 billion

Other

Provincial government revenue: $1.9 billion
Federal government revenue: $1.4 billion
Total: $3.3 billion

Canada

Provincial government revenue: $72.1 billion
Federal government revenue: $59.4 billion
Total: $131.7 billion

Annual Government Revenue by Region

Over the period 2019 and 2048, the Northern Gateway project was projected to generate the following annual government revenues by region (direct, indirect and induced):

British Columbia

Provincial government revenue: $340 million
Federal government revenue: $261 million
Total: $601 million per year

Alberta

Provincial government revenue: $1.5 billion
Federal government revenue: $1.2 billion
Total: $2.7 billion per year

Ontario

Provincial government revenue: $51 million
Federal government revenue: $79 million
Total: $130 million per year

Quebec

Provincial government revenue: $21 million
Federal government revenue: $16 million
Total: $37 million per year

Saskatchewan

Provincial government revenue: $204 million
Federal government revenue: $129 million
Total: $333 million per year

Other

Provincial government revenue: $58 million
Federal government revenue: $40 million
Total: $98 million per year

Canada

Provincial government revenue: $2.1 billion
Federal government revenue: $1.7 billion
Total: $3.8 billion per year

Employment by Region

Over the period 2019 to 2048, the Northern Gateway Pipeline was projected to generate the following direct, indirect and induced full-time equivalent (FTE) jobs by region:

British Columbia

Annual average: 7,736
Total over the period: 224,344

Alberta

Annual average: 11,798
Total over the period: 342,142

Ontario

Annual average: 3,061
Total over the period: 88,769

Quebec

Annual average: 1,003
Total over the period: 29,087

Saskatchewan

Annual average: 2,127
Total over the period: 61,683

Other

Annual average: 953
Total over the period: 27,637

Canada

Annual average: 26,678
Total over the period: 773,662

Alberta

Albertans need clarity on prime minister’s incoherent energy policy

Published on June 15, 2025

Todayville

From the Fraser Institute

By Tegan Hill

The new government under Prime Minister Mark Carney recently delivered its throne speech, which set out the government’s priorities for the coming term. Unfortunately, on energy policy, Albertans are still waiting for clarity.

Prime Minister Carney’s position on energy policy has been confusing, to say the least. On the campaign trail, he promised to keep Trudeau’s arbitrary emissions cap for the oil and gas sector, and Bill C-69 (which opponents call the “no more pipelines act”). Then, two weeks ago, he said his government will “change things at the federal level that need to be changed in order for projects to move forward,” adding he may eventually scrap both the emissions cap and Bill C-69.

His recent cabinet appointments further muddied his government’s position. On one hand, he appointed Tim Hodgson as the new minister of Energy and Natural Resources. Hodgson has called energy “Canada’s superpower” and promised to support oil and pipelines, and fix the mistrust that’s been built up over the past decade between Alberta and Ottawa. His appointment gave hope to some that Carney may have a new approach to revitalize Canada’s oil and gas sector.

On the other hand, he appointed Julie Dabrusin as the new minister of Environment and Climate Change. Dabrusin was the parliamentary secretary to the two previous environment ministers (Jonathan Wilkinson and Steven Guilbeault) who opposed several pipeline developments and were instrumental in introducing the oil and gas emissions cap, among other measures designed to restrict traditional energy development.

To confuse matters further, Guilbeault, who remains in Carney’s cabinet albeit in a diminished role, dismissed the need for additional pipeline infrastructure less than 48 hours after Carney expressed conditional support for new pipelines.

The throne speech was an opportunity to finally provide clarity to Canadians—and specifically Albertans—about the future of Canada’s energy industry. During her first meeting with Prime Minister Carney, Premier Danielle Smith outlined Alberta’s demands, which include scrapping the emissions cap, Bill C-69 and Bill C-48, which bans most oil tankers loading or unloading anywhere on British Columbia’s north coast (Smith also wants Ottawa to support an oil pipeline to B.C.’s coast). But again, the throne speech provided no clarity on any of these items. Instead, it contained vague platitudes including promises to “identify and catalyse projects of national significance” and “enable Canada to become the world’s leading energy superpower in both clean and conventional energy.”

Until the Carney government provides a clear plan to address the roadblocks facing Canada’s energy industry, private investment will remain on the sidelines, or worse, flow to other countries. Put simply, time is up. Albertans—and Canadians—need clarity. No more flip flopping and no more platitudes.