Government policies diminish Alberta in eyes of investors

Canada’s economy has stagnated, with a “mild to moderate” recession expected this year. Alberta can help Canada through this economic growth crisis by reaping the benefits of a strong commodity market. But for this to happen, the federal and provincial governments must eliminate damaging policies that make Alberta a less attractive place to invest.

Every year, the Fraser Institute surveys senior executives in the oil and gas industry to determine what jurisdictions in Canada and the United States are attractive—or unattractive—to investment based on policy factors. According to the latest results, red tape and high taxes are dampening the investment climate in the province’s energy sector.

Consider the difference between Alberta and two large U.S. energy jurisdictions—Wyoming and Texas. According to the survey, oil and gas investors are particularly wary of environmental regulations in Alberta with 50 per cent of survey respondents indicating that “stability, consistency and timeliness of environmental regulatory process” scared away investment compared to 14 per cent in Wyoming and only 11 per cent in Texas.

Investors also suggest that the U.S. regulatory environment offers greater certainty and predictability compared to Alberta. For example, 42 per cent of respondents indicated that “uncertainty regarding the administration, interpretation, stability, or enforcement of existing regulations” is a deterrent to investment in Alberta, compared to only 9 per cent in Wyoming and 13 per cent in Texas. Similarly, 43 per cent of respondents indicated that the cost of regulatory compliance was a deterrent to investment in Alberta compared to just 9 per cent for Wyoming and 19 per cent for Texas.

And there’s more—41 per cent of respondents for Alberta indicated that taxation deters investment compared to only 21 per cent for Wyoming and 14 per cent for Texas. Overall, Wyoming was more attractive than Alberta in 14 out of 16 policy factors assessed by the survey and Texas was more attractive in 11 out of 16.

Indeed, Canadian provinces are generally less attractive for oil and gas investment compared to U.S. states. This should come as no surprise—Trudeau government policies have created Canada’s poor investment climate. Consider federal Bill C-69, which imposes complex, uncertain and onerous review requirements on major energy projects. While this bill was declared unconstitutional, uncertainty remains until new legislation is introduced. During the COP28 conference in Dubai last December, the Trudeau government also announced its draft framework to cap oil and gas sector greenhouse gas emissions, adding uncertainty for investors due to the lack of details. These are just a few of the major regulations imposed on the energy industry in recent years.

As a result of these uncertain and onerous regulations, the energy sector has struggled to complete projects and reach markets overseas. Not surprisingly, capital investment in Alberta’s oil and gas sector plummeted from $58.1 billion (in 2014) to $26.0 billion in 2023.

The oil and gas sector is one of the country’s largest industries with a major influence on economic growth. Alberta can play a key role in helping Canada overcome the current economic challenges but the federal and provincial governments must pay attention to investor concerns and establish a more competitive regulatory and fiscal environment to facilitate investment in the province’s energy sector—for the benefit of all Canadians.

Authors:

Julio Mejía

Policy Analyst

Tegan Hill

Associate Director, Alberta Policy, Fraser Institute

Related Topics:#FraserInstitute #JulioMejía #OilAndGasInvestment #OilAndGasPolicies #TeganHill canadianenergy

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

Alberta / 3 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.