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Energy

Justin Trudeau’s existential problems with oil and gas: Jack Mintz

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7 minute read

From the MacDonald Laurier Institute

By Jack Mintz

Squeeze the industry to please his party’s green base or keep output, revenue and high-paying employment flowing?

Talk at the latest climate-change shindig in Dubai has centred around the future of the oil industry and whether countries should pledge to phase out oil and gas production entirely or simply transform the industry in decades to come. Canada always talks a deep-green game at these affairs but are we really ready to nail shut the oil and gas coffin?

Maybe not. In Dubai Canada announced a cap-and-trade approach to oil and gas emissions but argued it won’t actually stop oil and gas production outright. The provinces, who yet again weren’t consulted, may not agree. Besides, promises are one thing. The record is another.

It also emerged in Dubai that the Emirates, seventh largest oil producer, is expecting to increase its production by a million barrels a day (mbd) by 2030. This is not a new trend. According to the U.S. Energy Information Service, the UAE increased production of oil and hydrocarbon liquids like coal oil by 15.3 per cent between 2015 and 2022, from 3.7 mbd to 4.2, fourth-most of all oil-producing economies. That’s much faster than world output, which was up only 3.6 per cent since 2015, reaching 100.1 mbd last year.

The irony — maybe even the hypocrisy — is that three countries in the Americas have increased their petroleum output even more than this Middle Eastern oil sheikhdom has: the U.S., Brazil and, yes, us: Canada.

The Biden administration, which is promising 2030 emissions will be half 2005 levels, has so far failed to stymie oil and gas development. U.S. petroleum and liquids production has soared by 33.9 per cent since 2015, reaching 20.3 mbd in 2022. Two-fifths of the increase has been on Biden’s watch. The U.S., not Saudi Arabia, is now the world’s leading oil producer, accounting for fully 20 per cent of global supply.

The Trudeau government has pledged that 2030 oil and gas emissions will be 42 per cent lower than in 2005. This has led to tensions with the oil- and gas-producing provinces, which are resisting emissions caps for oil, gas and electricity. Ottawa’s opposition to liquefied natural gas sales even as the U.S. and Qatar are making great inroads in the world market has had industry leaders scratching their heads. Even so, since the Liberals came to power in 2015, Canada’s oil and gas production has grown second fastest globally, at 26.7 per cent, to reach 5.6 mbd last year. Much of this growth is due to big investments in the oil sands before 2015 but the production increase has been accommodated by pipeline expansion, with the federally-owned TMX soon to come on stream.

Neither Biden nor Trudeau is attending COP28 but Brazil’s president, Lula de Silva, stormed in at the head of a delegation of 2000 to repeat a pledge to cut 2030 emissions to less than half 2005 levels. Much of reduction results from reforestation, however, not phasing out oil and gas. And, to the surprise of attendees, Lula announced that Brazil will align itself more closely with OPEC. No shock there. Since 2015, Brazil’s oil and gas production has risen by 20 per cent, making it the 8th largest producer in the world at 3.8 mbd last year. It now evidently sees itself as a player.

Besides the U.S. Canada, Brazil and UAE, only Iraq (at 10.4 per cent) and Kazakhstan (at 4.5 per cent) have seen their oil production grow faster than the world average since 2015. The rest have had little growth, with seven countries registering declines, including 22.4 per cent in Mexico and 36.7 per cent in Nigeria, the biggest drop anywhere.

The standstill or even loss in oil and gas production in many oil-producing countries since 2015 is due to several factors. Oil prices dropped by three-fifths after 2014 and the pandemic caused another crash. More recently, Saudi Arabia and Russia have persuaded OPEC+ to constrain production and push prices to over US$80 per barrel — mainly in order to replenish their treasuries. In some places, including Ghana, the U.K. and Norway, old fields are depleting. Elsewhere, but especially in Africa and Mexico, crime and political instability continue to discourage development. Finally, in the face of lagging demand, investors have encouraged companies to distribute profits rather than invest in greenfield oil and gas projects.

But top producers like the U.S. and Canada are not holding back and governments aren’t stopping them. Phase-out is all short-term cost in pursuit of climate gains that won’t be realized for decades, if at all. Nor are politicians willing to eliminate the tax revenues and high-paying jobs the industry generates. With energy security crucial in an increasingly dangerous world, oil-consuming countries are finding that intermittent renewable energy and other high-cost energy sources are no substitute for fossil fuels.

As the federal Liberals sink in the polls, they face a many-ways existential choice. Do they pursue their climate promises and phase out oil and gas? Or do they secure the benefits of oil and gas production for years to come? Or, a third option: do they say one thing but quietly do the other? Is it all, as Shakespeare would say, “much ado about nothing”?

Business

Carney’s Honeymoon Phase Enters a ‘Make-or-Break’ Week

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From the National Citizens Coalition 

The National Citizens Coalition (NCC) is sounding the alarm on a critical week for the Carney government, which, despite enjoying an unearned honeymoon in the polls, has delivered zero results for everyday Canadians. As the G7 summit looms large and the House of Commons prepares to adjourn, this is a make-or-break moment for Prime Minister Mark Carney to prove his government is more than empty promises. Canadians are watching, and the NCC is calling out the glaring failures that threaten a grim summer of economic decline, and continued crime, chaos, and rising unemployment.

Housing Minister Gregor Robertson Caught in $10.85 Million Scandal

Recent revelations from Blacklock’s Reporter expose Housing Minister Gregor Robertson’s attempt to conceal $10.85 million in personal property investments during Commons questioning. This shocking lack of transparency from the minister tasked with addressing Canada’s housing crisis raises serious questions about his integrity and ability to prioritize Canadians struggling with skyrocketing costs. While Robertson dodges accountability, and Carney apparently scoffs at providing housing relief to millions suffering under a Liberal-made crisis, young professionals and young families are wondering if they’ll ever have a chance to own a home bigger than Canada’s much-maligned supply of ‘dog-crate condos.’

The NCC demands a full ethics investigation, the resignation of Gregor Robertson — who, as one of the architects of the Vancouver housing crisis, should have never been handed this file to begin with — and immediate action to restore trust in this critical portfolio.

Pipeline Delays and Provincial Obstruction Threaten Economic Growth

The Carney government’s inaction on pipelines is stalling Canada’s economic potential. Despite promises of “nation-building projects,” British Columbia and Quebec continue to block and veto critical energy infrastructure, with Carney failing to assert federal leadership. His vague talk of “consensus” and “decarbonized” barrels has led to zero progress, leaving Alberta’s economy in limbo and Canadians facing higher energy costs. With no clear plan to advance projects, the government is squandering opportunities to create jobs and secure energy sovereignty. The NCC urges Carney to act decisively this week to break the provincial logjam and deliver results.

Immigration Chaos: Lena Diab’s Unchecked Honour System Fails Canadians

Immigration Minister Lena Diab’s reliance on an ‘honour system’ for millions of temporary visitors with expiring visas is a recipe for disaster. As Canada grapples with unsustainable immigration levels, Diab’s apparent plan for millions of temporary workers and failed ‘diploma mill’ attendees assumes compliance without enforcement, ignoring the high-propensity for fraud, and the ongoing and urgent strain on housing, healthcare, and public services. The Liberals’ Strong Borders Act promises reform, but its loaded with unnecessary overreach and vague measures.

A lack of urgency leaves Canadians vulnerable to further crime, chaos, closed emergency rooms, high rents, and failing infrastructure. With immigration continuing to spiral out of control, the NCC calls for concrete action to drastically lower immigration targets, expedite deportations, and prioritize Canadian citizens and the record amounts of unemployed before the House adjourns.

Canadians Deserve Results, Not More Hollow “Elbows up” or “Team Canada” Rhetoric

This week’s G7 summit in Alberta and the impending House adjournment are the Carney government’s last chance to show leadership, before an undeserved summer break for a government that will be overseeing deepening economic decline, rising crime under a refusal to tackle catch-and-release bail, and growing unemployment. Canadians cannot afford another season of unfulfilled promises and unchecked crises. The NCC demands Carney use the G7 platform to secure trade stability, meaningful energy deals with our allies, and table a federal budget to address the cost-of-living crisis made worse by inflationary Liberal spending. Failure to act now will cement an early legacy of inaction and leave Canadians to endure a prolonged period of hardship.

“The Carney government’s honeymoon has been built on hype, not results,” says NCC Director Alexander Brown. “From Gregor Robertson’s hidden millions, to stalled pipelines, to an immigration system in continued disarray, Canadians — and particularly young Canadians — are being let down. This week is Carney’s chance to prove he can deliver beyond the lies that were told to placate a portion of the electorate at the polls. If he fails to act, the economic decline, the crime and chaos, will only worsen, and everyday Canadians will pay the price.

“True Canadian leaders like Alberta Premier Danielle Smith are in attendance at the G7 along with Carney. If actual acts of ‘nation-building,’ and not more net-zero de-growth, do not come naturally to the PM, he should turn to those who have never wavered in their quest to make life more affordable for the hard-working citizens they are privileged to represent, and who know when to get out of the way to allow Canadians to prosper. More of the same internal, ideological sabotage from the Liberals cannot ruin this dire moment for Canada’s rebirth and recovery.”

The NCC calls on all Canadians to hold the Carney government accountable. Join us in demanding transparency, action, and results before the House adjourns and the G7 summit concludes. Together, we can fight for a stronger, more prosperous Canada.

About the National Citizens Coalition: Founded in 1967, the NCC is a non-profit organization dedicated to advocating for individual freedom, lower taxes, less government waste, and a stronger Canada. We hold governments accountable and fight for the interests of everyday Canadians.

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Energy

Could the G7 Summit in Alberta be a historic moment for Canadian energy?

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From Resource Works

By

Canada can be the democratic world’s top energy supplier, and the G7 Summit in Alberta is the perfect time to commit to that.

Canada is at the crossroads of opportunity as the leaders of the G7 convene in Kananaskis, Alberta.

An Ipsos poll has named Canada the top preferred oil supplier among G7 countries for the second time since 2023. No less than 68 percent of G7 respondents declared that Canada was among their top three choices to supply oil.

This should be yet another motivator for Canada to solidify itself as a key player in energy security and economic stability among the democratic nations.

The timing and location of this year’s G7 summit shows how important Canada can be to the world. Alberta, Canada’s energy heartland, is the source of nearly all of the country’s oil, and the provincial government wants more of it to reach global markets.

Those geopolitical anxieties caused by Russia’s invasion of Ukraine in 2022 have not disappeared, and Canada’s allies and partners like the European Union (EU), Japan, South Korea, and India are looking for a reliable and responsible partner to supply them with energy, and we are the best and most obvious choice.

Willing partners are easy to find overseas, but the other provinces and the federal government need to become equally enthusiastic first.

There is more to this than mere symbolism. Canada embracing its position as the most desirable supplier of oil makes complete sense.

In 2023, Ipsos found that Canada’s political stability, comprehensive environmental rules, and strong regulatory frameworks are why it ranked first among preferred oil suppliers. Norway is another popular option, but Canada has the advantage of better market access to the United States and the Asia-Pacific, along with established infrastructure and an open government.

It all combines to create a distinct advantage for Canada in the world of trade.

The US has slid as a popular oil supplier, to Canada’s advantage, and we need to capitalize on that more than ever.

As Russia’s bloody, disruptive war with Ukraine continues to drag on, the EU still needs sources of alternative energy to make a clean break with Moscow. Russia had previously served as the bloc’s effective gas station, albeit one armed with nuclear weapons.

G7 member states like Britain and the EU are looking to slap even stricter limits on Russian energy exports that go beyond what is already in place. Whatever Russia has to lose is Canada’s to gain.

Canada began to enlarge its export capacity last year with the completion of the twinning of Trans Mountain pipeline (TMX), enabling Canada to double the amount of oil it can pipe to Pacific markets. Shipping larger amounts of Canadian energy to partners in Japan, India, South Korea, and others has never been easier.

It was a monumental example of how investing in the right sorts of infrastructure can improve economic security, both nationally and internationally. Internally, developing the oil industry is a long term goal of First Nations leaders and communities.

The myth of First Nations opposing the expansion of oil and gas is one that needs to die. The Indian Resource Council, which represents over 130 First Nations, has repeatedly championed the responsible development of natural resources as a means of fostering economic independence and community renewal.

Many First Nations and other Indigenous groups have invested heavily into pipelines, production sites and storage facilities, and want to expand it further. In terms of pure economic value, there is not another industry that has created more wealth in Indigenous communities across Western Canada.

Complacency from the federal government and other authorities at this time could not be timed more poorly as the G7 Summit comes to Alberta. When the gathering ends on June 17, we should hope that it was a turning point where Canada made a direct and clear commitment to modernizing and expanding its oil and gas sector.

Our role in the world can be that of the great democratic alternative to Russia when it comes to supplying energy and other resources. Alberta knows it, as do our allies and Indigenous people across Canada.

Ottawa should listen. It is time to realize our potential to be an even greater energy superpower.

Through that, we can reduce the power of authoritarian, hostile regimes in the world by building a stronger, more unified Canada.

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