Alberta responses to federal energy stimulus package: A good start!

From the Province of Alberta

Federal energy stimulus package: Premier Kenney

Premier Jason Kenney issued the following statement on the federal government’s energy stimulus package:

“How we come through this economic crisis will depend in large part on the survival and the successful recovery of our country’s largest industry – the energy sector – on which some 800,000 Canadian jobs depend. We thank the federal government for taking this important first step to support the folks who work in our energy sector.

“The $1 billion partnership to address inactive wells aligns with Alberta’s commitment to ensuring our resources are developed in an environmentally sustainable fashion. This funding will immediately save or create thousands of jobs, keeping energy service companies going during these devastating times. It will also help us bring sites back to their original condition, leaving a cleaner environment for future generations. The $200 million loan to the Orphan Well Association will also help these efforts, demonstrating our commitment to producing Canadian energy under the world’s highest environmental standards.

“More support is needed to deal with the crisis in Canada’s energy sector, but this is a great first step. Our energy sector is facing its biggest challenge ever, and we need to be sure that industry can access the capital it needs to survive and thrive in future years. When the auto sector and the banks were threatened during the global financial crisis a decade ago, the economic strength of Alberta, powered by the energy industry, ensured that Canada was able to provide the urgent support they needed. We will continue to work with the federal government to ensure that the energy sector now gets the support it needs as it faces its own threats from both the COVID-19 pandemic and the Saudi-Russia price war.

“This unprecedented disruption in the world energy markets will eventually recede. Better times for the industry are a matter of when – not if – but only if the industry survives the next couple of years. We need to make sure Alberta is prepared and ready for the global recovery when the time comes. Alberta’s energy industry is the lifeblood of our provincial economy – and the largest subsector of Canada’s economy, as well as one of its biggest employers. The energy sector helps some of our country’s most important industries thrive, including health care, manufacturing and transportation.

“We are grateful for this job-creating initiative, and we will continue to work with the federal government until the energy sector has what it needs to survive and thrive for the benefit of all Canadians.”

From the Alberta NDP Caucus

SCHMIDT STATEMENT ON FEDERAL SUPPORT FOR ENERGY INDUSTRY

Marlin Schmidt, NDP Environment Critic, issued the following statement regarding the federal government’s aid package for Alberta’s energy industry:

“Cleaning up oil and gas sites is good news for our energy sector workers, landowners, and our environment. From day one, we have been advocating for support to cleanup orphan wells. It will put thousands of Albertans back to work while supporting responsible resource development.

“The UCP government must use this money in a way that ensures polluters still pay for the cleanup of their sites. They must also set clear targets and timelines for well cleanup now and into the future. I also hope the UCP will ensure landowners and municipalities are compensated for wells on their land.

“While this is good news for our energy sector and landowners, there are still a lot of Albertans and businesses struggling to make ends meet. I wish Premier Kenney and the UCP would step up and provide real leadership to support all Albertans and all sectors of our province instead of constantly relying on the federal government to act first.”

From the Alberta Federation of Labour

Alberta unions applaud federal support for oil and gas workers

“The money for orphan wells and methane reduction, announced by the federal government today, will help the environment and create jobs at a time when they’re desperately needed,” says the president of Alberta’s largest worker advocacy organization.

“This is a classic win-win scenario,” says Gil McGowan, president of the Alberta Federation of Labour. “The $1.7 billion being dedicated to orphan and abandoned wells can be put to use almost immediately. It will help address a problem that has been simmering in Alberta for years and, in the process, it will put literally thousands of people in the oil field service industry back to work. There is no doubt in my mind that this is one of the most constructive things that the federal government can do to help oil and gas workers at this time. It’s greatly appreciated.”

McGowan says he’s also very happy with the work the federal government did to get input from a wide variety of stakeholders.

“Here in Alberta, we’re used to our provincial governments consulting only with industry and then making a policy based on that narrow range of perspectives. But the federal government took a very different approach, consulting with workers, environmental groups, landowners and others, in addition to industry. It’s very refreshing. And, I think it shows that you get better policy outcomes when you take the time to hear from a wider cross-section of people.”

Of the $1.7 billion ear-marked for well remediation, $200 million will go directly to Alberta’s Orphan Well Association and $1 billion will go directly to the Alberta government. Alberta will be required to address concerns about how the whole issue of orphan wells is managed going forward.

“That last point is really important to us,” concluded McGowan. “This money won’t just create jobs; it will also require the Alberta government to clean up its act when it comes to implementing and overseeing rules requiring oil and gas companies to clean up their acts. That’s very good news for our province.”

From the Progressive Contractors Association of Canada

PCA: Federal Aid Package for Oil and Gas Sector a Beginning

The $1.7 billion aid package announced today for the oil and gas sector is a welcome start, according to the Progressive Contractors Association of Canada (PCA) which has seen many of its member company operations in the oil sands sector scaled back, shut down or delayed, resulting in thousands of layoffs.

“It’s a good day when thousands of jobs in Western Canada can be saved,” said Paul de Jong, President of the Progressive Contractors Association of Canada (PCA). “However, with a record number of energy companies folding, it will take far more to stave off a full-scale collapse.”

Prime Minister Trudeau announced $1.7 billion in funding to clean up orphaned oil wells in Alberta, Saskatchewan and British Columbia. The aid is expected to maintain as many as 5,200 jobs in Alberta alone.

“We’re still waiting for a federal aid package that fairly reflects the value and importance of the oil and gas industry,” added de Jong. “Given that this sector accounts for more than a tenth of GDP and employs tens of thousands of workers, the government still has a long way to go in demonstrating a real commitment to its survival.”

Last week, PCA sent Trudeau a letter, urging his government to provide support to the oil and gas sector without further delay.

About the Progressive Contractors Association of Canada (PCA) With offices in BC, Alberta and Ontario, PCA is the voice of progressive unionized employers in Canada’s construction industry. Our member companies are responsible for 40 percent of energy and natural resource construction projects in British Columbia and Alberta and are leaders in infrastructure construction across Canada. PCA member companies employ more than 25,000 skilled construction workers in Canada, represented primarily by CLAC.

From the Canadian Association of Petroleum Producers

CAPP issues statement recognizing the Government of Canada’s support for the oil and natural gas industry

“The Canadian Association of Petroleum Producers (CAPP) recognizes the Government of Canada’s support for the oil and natural gas industry, and appreciates the initiatives announced today which will protect about 10,000 jobs across the country.

The $1.7 billion announced today, for the closure and reclamation of orphan and inactive wells in Saskatchewan, Alberta, and British Columbia, is welcome news. Reducing environmental liabilities is a priority for the oil and natural gas industry and this initiative will allow important work to accelerate, while supporting thousands of jobs.

The government also announced a $750 million emissions reduction fund which will help companies continue their progress to reduce methane emissions. Canada’s oil and natural gas industry has committed to a 45 percent reduction of methane emissions by 2025, and the government is helping ensure that innovation and progress in this key area can continue during the economic crisis.

We are also encouraged by news that the government is working with the Business Development Bank of Canada and Export Development Canada to strengthen support for corporations who are most at risk. Liquidity is a real and immediate challenge for oil and natural gas producers and CAPP has been working with the federal government to identify urgent action needed to address the dire situation. We are awaiting additional details on the expansion of support — a critically important matter as companies try to weather the current crisis.

CAPP will continue to talk with all levels of government to ensure adequate support is in place to help businesses and jobs survive this unprecedented economic crisis. Survival of the energy sector will be crucial to Canada’s economic recovery.”

-Tim McMillan, President and CEO – Canadian Association of Petroleum Producers

From Cenovus, Brett Harris, Manager of Communications

We are appreciative that the federal government recognizes the dire situation the energy industry is in with the decrease in oil demand due to COVID-19 resulting in unprecedented low oil prices. The industry is in survival mode and needs the government to provide support to help companies preserve cash and access additional liquidity so they can still be here to help rebuild the economy once the immediate crisis passes.

We need more details about the federal aid for inactive and abandoned wells and methane emissions reduction. Cenovus has a strong history of addressing these areas of environmental responsibility and we will continue to take proactive actions so the government funding may help us progress these activities. Again, we still need to see the details.

The most important action the federal government can take to ensure the industry remains strong is by providing a temporary safety net in the form of increased access to liquidity. There are many options for this support to be delivered and we are urging the government to take swift action to pursue that.

Trudeau says $1.7B coming for orphaned-well cleanups

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After 15 years as a TV reporter with Global and CBC and as news director of RDTV in Red Deer, Duane set out on his own 2008 as a visual storyteller. During this period, he became fascinated with a burgeoning online world and how it could better serve local communities. This fascination led to Todayville, launched in 2016.

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Net Zero goal is a fundamental flaw in the Ottawa-Alberta MOU

Published on November 30, 2025

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From the Fraser Institute

By Jason Clemens and Elmira Aliakbari

The challenge of GHG emissions in 2050 is not in the industrial world but rather in the developing world, where there is still significant basic energy consumption using timber and biomass.

The new Memorandum of Understanding (MOU) between the federal and Alberta governments lays the groundwork for substantial energy projects and infrastructure development over the next two-and-a-half decades. It is by all accounts a step forward, though, there’s debate about how large and meaningful that step actually is. There is, however, a fundamental flaw in the foundation of the agreement: it’s commitment to net zero in Canada by 2050.

The first point of agreement in the MOU on the first page of text states: “Canada and Alberta remain committed to achieving net zero greenhouse gas emissions by 2050.” In practice, it’s incredibly difficult to offset emissions with tree planting or other projects that reduce “net” emissions, so the effect of committing to “net zero” by 2050 means that both governments agree that Canada should produce very close to zero actual greenhouse gas (GHG) emissions. Consider the massive changes in energy production, home heating, transportation and agriculture that would be needed to achieve this goal.

So, what’s wrong with Canada’s net zero 2050 and the larger United Nations’ global goal for the same?

Let’s first understand the global context of GHG reductions based on a recent study by internationally-recognized scholar Vaclav Smil. Two key insights from the study. First, despite trillions being spent plus international agreements and regulatory measures starting back in 1997 with the original Kyoto agreement, global fossil fuel consumption between then and 2023 increased by 55 per cent.

Second, fossil fuels as a share of total global energy declined from 86 per cent in 1997 to 82 per cent in 2022, again, despite trillions of dollars in spending plus regulatory requirements to force a transition away from fossil fuels to zero emission energies. The idea that globally we can achieve zero emissions over the next two-and-a-half decades is pure fantasy. Even if there is an historic technological breakthrough, it will take decades to actually transition to a new energy source(s).

Let’s now understand the Canada-specific context. A recent study examined all the measures introduced over the last decade as part of the national plan to reduce emissions to achieve net zero by 2050. The study concluded that significant economic costs would be imposed on Canadians by these measures: inflation-adjusted GDP would be 7 per cent lower, income per worker would be more than $8,000 lower and approximately 250,000 jobs would be lost. Moreover, these costs would not get Canada to net zero. The study concluded that only 70 per cent of the net zero emissions goal would be achieved despite these significant costs, which means even greater costs would be imposed on Canadians to fully achieve net zero.

It’s important to return to a global picture to fully understand why net zero makes no sense for Canada within a worldwide context. Using projections from the International Energy Agency (IEA) in its latest World Energy Outlook, the current expectation is that in 2050, advanced countries including Canada and the other G7 countries will represent less than 25 per cent of global emissions. The developing world, which includes China, India, the entirety of Africa and much of South America, is estimated to represent at least 70 per cent of global emissions in 2050.

Simply put, the challenge of GHG emissions in 2050 is not in the industrial world but rather in the developing world, where there is still significant basic energy consumption using timber and biomass. A globally-coordinated effort, which is really what the U.N. should be doing rather than fantasizing about net zero, would see industrial countries like Canada that are capable of increasing their energy production exporting more to these developing countries so that high-emitting energy sources are replaced by lower-emitting energy sources. This would actually reduce global GHGs while simultaneously stimulating economic growth.

Consider a recent study that calculated the implications of doubling natural gas production in Canada and exporting it to China to replace coal-fired power. The conclusion was that there would be a massive reduction in global GHGs equivalent to almost 90 per cent of Canada’s total annual emissions. In these types of substitution arrangements, the GHGs would increase in energy-producing countries like Canada but global GHGs would be reduced, which is the ultimate goal of not only the U.N. but also the Carney and Smith governments as per the MOU.

Finally, the agreement ignores a basic law of economics. The first lesson in the very first class of any economics program is that resources are limited. At any given point in time, we only have so much labour, raw materials, time, etc. In other words, when we choose to do one project, the real cost is foregoing the other projects that could have been undertaken. Economics is mostly about trying to understand how to maximize the use of limited resources.

The MOU requires massive, literally hundreds of billions of dollars to be used to create nuclear power, other zero-emitting power sources and transmission systems all in the name of being able to produce low or even zero-emitting oil and gas while also moving to towards net zero.

These resources cannot be used for other purposes and it’s impossible to imagine what alternative companies or industries would have been invested in. What we do know is that workers, entrepreneurs, businessowners and investors are not making these decisions. Rather, politicians and bureaucrats in Ottawa and Edmonton are making these decisions but they won’t pay any price if they’re wrong. Canadians pay the price. Just consider the financial fiasco unfolding now with Ottawa, Ontario and Quebec’s subsidies (i.e. corporate welfare) for electric vehicle batteries.

Understanding the fundamentally flawed commitment to Canadian net zero rather than understanding a larger global context of GHG emissions lays at the heart of the recent MOU and unfortunately for Canadians will continue to guide flawed and expensive policies. Until we get the net zero policies right, we’re going to continue to spend enormous resources on projects with limited returns, costing all Canadians.