Alberta
A Matter of Fact: Environment Minister Steven Guilbeault’s future view of Canada’s oil and gas sector is unrealistic
Canadian Minister of the Environment and Climate Change, Steven Guilbeault, speaks at the China pavilion during the United Nations Conference of the Parties (COP15) in Montreal, Quebec, on December 14, 2022. Getty Images photo
From the Canadian Energy Centre Ltd.
Canada could play a key role in lowering global emissions by unlocking our LNG industry and helping Asian countries replace coal
Federal Environment and Climate Change Minister Steven Guilbeault is continuing to plot a painful course toward a short-sighted phase out of Canada’s world class oil and gas sector based on an unrealistic view of world’s future energy mix.
In an interview with Euractiv, Guilbeault said he supports the phase out of unabated fossil fuels, those without the technology to minimize emissions, by 2050 to align with the International Energy Agency’s Net Zero Scenario, a path that is largely out of touch with the current global reality.
Based on that increasingly unlikely scenario, the minister said he anticipates Canada’s oil and gas sector will follow suit with a 50% to 75% reduction in the production of oil and gas by 2050, which would be devastating for our economy, hurt our economic allies, and make little to no progress towards reducing global emissions.
Here are the facts.
Fact: The IEA’s Net Zero Scenario is largely aspirational, not practical
Guilbeault’s vision of a massive global reduction of fossil fuel usage is growing even less likely amid a lingering energy crisis prompted by several years of declining investment in oil and gas followed by Russia’s invasion of Ukraine.
The fact is, this year the world will use more oil and more coal than any time in human history.
According to the IEA’s latest short-term outlook, global oil use will hit a record high of 102 million barrels per day this year and is expected to grow to 106 million barrels per day by 2028. Last week, OPEC forecasted that by 2045, global oil demand will reach 110 million barrels per day.
Meanwhile, demand for natural gas, particularly liquefied natural gas (LNG) is soaring.
By 2040, global LNG demand – driven primarily by growing Asian economies – is expected to reach 700 million tonnes, a more than 75 per cent increase from 2022. Demand for LNG is expected to outpace supply by the middle of this decade.
Relying on the IEA’s Net Zero scenario, Guilbeault said he believes oil use will decline to between 25-30 million barrels per day, a 75 per cent reduction. Rapid deployment of renewables, he said, would fill that void despite some significant hurdles that could hinder a sweeping transition.
The bottom line is pretty clear. In the IEA’s most likely scenario, oil and gas will still account for 47 per cent of the global energy mix in 2050, a reduction of 5 per cent from 2021. While the share of renewables will more than double, it is still expected only to account for 29 per cent of the world’s energy mix in 2050.
Fact: A rapid phase out of oil and gas would hurt Canada and its allies
Canada’s oil and gas sector is a critical part of our economy, supporting hundreds of thousands of jobs from coast-to-coast, including thousands of jobsin manufacturing, environmental, and financial services tied to the industry, especially in Ontario and Quebec.
A recent analysis by commodity data firm S&P Global focused specifically on the oil sands suggests that efforts to meet federal emissions targets for 2030 would likely force the industry to slash production by up to 1.3 million barrels per day.
According to the analysis, that could result in the elimination of between 5,400 and 9,500 jobs. With just over 54,000 oil and gas extraction jobs in Canada, that would mean the elimination of as much as 17% of the workforce.
In addition to jobs, the industry is also an economic bulwark, generating $168 billion in GDP in 2021, about 7.2 per cent of Canada’s economic activity. Oil and gas also accounted for nearly a third of Canada’s exports in 2021, injecting $140 billon into the economy.
Amid the ongoing global energy crisis, some of Canada’s international allies have turned to Canada to be a potential key supplier as they look for stable and responsible suppliers to replace Russian oil and gas.
The leaders of Germany and Japan made direct appeals to Canada to supply more LNG to help meet their energy needs.
Yamanouchi Kanji, Japan’s ambassador to Canada, made it clear that some of our Asian allies see Canada as a key player in the world’s future energy, particularly when it comes to LNG.
“The world is waiting for Canada,” he said earlier this year. “Canada can and should play a very important role to support the energy situation not only in Japan and South Korea, but the world.”
Fact: Reducing global emissions starts with Canadian natural gas
If Canada is truly serious about tackling global greenhouse gas emissions, we could make a much bigger impact by supplying energy-hungry Asian countries with some of the cleanest LNG on the planet to replace coal.
Climate change is a global issue, not a local one.
Despite being one of the world’s largest energy producers, Canada is still only responsible for about 1.6 per cent of total global emissions.
Developing Asian counties, particularly China, have turned to coal to help power their growing economies. A switch to natural gas to generate power reduces emissions by 50 per cent on average, according to the IEA. Canadian natural gas shipped as LNG could perform even better, reducing emissions from coal by about 65 per cent, according to Energy for a Secure Future.
With analysts expecting world LNG demand to double over the next two decades, Canada could make a real measurable impact on lowering global emissions by unlocking its LNG potential.
A recent study by Wood Mackenzie found that Canadian LNG exports could reduce net emissions in Asia by 188 million tonnes per year through 2050. Put another way, that would be the annual equivalent of removing the emissions of all vehicles on Canadian roads, or wiping out nearly three time’s B.C.’s total emissions.
Meanwhile, a coalition of six companies representing 95 per cent of Canada’s oil sand production have jointly committed to achieve net zero emissions by 2050. The Pathways Alliance is looking to harness emerging technology like carbon capture and storage as well as small modular nuclear reactors to reach that target.
The reality is that if Canada significantly curtails its oil and gas industry, other national producers, some of which lack Canada’s commitment to democratic ideals and the environment, will fill that void. This could see bad actors like Russia continue to maintain a strategic and economic advantage over Europe by maintaining European reliance on its energy.
Fact: Phasing out oil and gas would hurt Indigenous communities
Over the last decade, Indigenous communities have emerged as key players in Canada’s energy sector, allowing First Nations in many cases to create intergenerational opportunity for their people.
From pipelines to LNG terminals, dozens of Indigenous communities have entered into ownership agreements on major oil and gas projects.
In B.C., 16 First Nations will acquire a 10 per cent stake in the Coastal GasLink pipeline once it’s completed later this year. In Alberta, another 23 First Nation and and Métis communities are now approximately 12 per cent owners of seven operating Enbridge oil sands pipelines, the largest Indigenous energy transaction ever in North America.
And in northwest B.C., the Haisla Nation is 50 per cent owner of the proposed Cedar LNG project, which would be the first Indigenous-owned LNG terminal in the world.
“When Europeans, Asians and Americans think of Canada’s Indigenous peoples, they often think we oppose all energy development. We aren’t victims of development. Increasingly we are partners and even owners in major projects,” Haisla Nation Chief Councillor Crystal Smith said during an April press conference after leading a delegation of Indigenous leaders to meet key international diplomats.
Indigenous employment in Canada’s oil and gas sector has continued to grow, rising by more than 20 per cent since 2014 to reach an estimated 10,400 jobs in 2020.
Indigenous-owned businesses also benefit from the industry, with three major projects – the Trans Mountain Expansion, Coastal GasLink, and LNG Canada – spending some $9 billion with Indigenous- and locally-owned businesses.
Alberta
Official statement from Premier Danielle Smith and Energy Minister Brian Jean on the start-up of the Trans Mountain Pipeline
Alberta
Protecting the right to vote for Canadian citizens: Minister McIver
Minister of Municipal Affairs Ric McIver issued the following statement in response to Calgary City Council’s vote to extend the right to vote to permanent residents:
“Yesterday, Calgary city council passed a motion advocating for permanent residents to be extended the right to vote in civic elections. Alberta’s government has been clear since the beginning: only Canadian citizens are able to vote in civic elections. That will not be changing.
“The Canadian Charter of Rights and Freedoms affirms the right of every Canadian citizen to vote and to run as a candidate. This right extends to voters in municipal, provincial and federal elections.
“Protecting our democracy is of the utmost importance. Our provincial election legislation, like the Local Authorities Elections Act, has also been clear since its inception that voting is a right of Canadian citizens.
“Alberta’s government is also ensuring that voting is accessible for more Albertans. The Municipal Affairs Statutes Amendment Act proposes to enable special ballot access for any voter who requests it, without having to provide any specific reason such as physical disability, absence from the municipality or working for the municipal election. The ministries of Seniors, Community and Social Services and Service Alberta and Red Tape Reduction are also making it easier for individuals to obtain the identification Albertans need for a variety of services, including the ability to cast a ballot.
“Our government will continue to protect the integrity of our elections and make sure voting is accessible for all Albertans who are Canadian citizens.”
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