GOLDSTEIN: Embracing the oil and gas sector cuts our economic throat

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Canadians should be alarmed at the number of business opportunities that will be lost because Prime Minister Justin Trudeau thinks of Canada’s oil and gas sector primarily in terms of downsizing.

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Ditto the inaccurate impression created by his environment ministers since 2015 that Canada’s oil and gas sector is on the way out because of Trudeau’s carbon pricing policies to fight climate change.

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In fact, Canada is the world’s fifth largest producer and fourth largest exporter of oil and natural gas.

The federal government’s Canada Energy Regulator projected in 2019 that Canada’s oil sector would grow by almost 50% and the natural gas sector by 30%, from 2018 to 2040.

The federal government’s Department of Natural Resources says that in 2020, Canada’s oil and gas sector provided 178,500 direct jobs and supported another 415,000, accounted for 5.7% of GDP at $118 billion, 16% of exports at $86 billion and $38 billion in capital spending.

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He says that « oil, natural gas, coal and hydrocarbon gas liquids are essential elements of Canada’s energy mix and continue to be a major driver of employment, exports and economic activity. wider”.

The Financial Post recently reported that according to an analysis by the Royal Bank of Canada, the oil and gas sector will pay $48 billion this year in taxes and royalties to Canadian governments, and $64 billion next year.

The U.S. Energy Information Administration says oil and natural gas will continue to be America’s primary energy sources in 2050, and while renewables will expand rapidly, 70% of the world’s energy in 2050 will be supplied by fossil fuels.

The future of Canada’s oil and gas sector lies in producing with the lowest possible greenhouse gas emissions while competing globally for market share in a huge economic sector.

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This while taking advantage of the fact that G7 countries, including Canada and the European Union, classify natural gas as a transitional form of green energy, especially when it replaces coal to generate electricity.

The economic danger posed by the Trudeau government’s nonchalant attitude towards the Canadian oil and gas sector was reflected in Trudeau’s downplaying of the shipment of liquefied natural gas (LNG) to Germany during the German Chancellor’s visit. Olaf Scholz in Canada last week.

Scholz is desperate for new sources of natural gas as Russian President Vladimir Putin turns the energy screw on Germany by cutting Russian exports as punishment for supporting Ukraine in the face of Putin’s invasion.

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Germans face skyrocketing costs for natural gas to heat their homes this winter and possible rationing.

Trudeau said the business case for shipping natural gas directly from Canada to Germany is weak due to the lack of pipelines and LNG conversion plants needed to transport it from Western Canada to the east coast and from there to ocean-going tankers bound for Europe.

He said his government would consider streamlining regulatory approval of LNG infrastructure if the economic case for it becomes viable, but his main goal is to decarbonize the Canadian economy.

But Timothy Egan, president and CEO of the Canadian Gas Association, told The Globe and Mail that the biggest hurdle is actually the regulatory uncertainty created by the Trudeau government.

“There’s an incredible business case if the regulatory framework is clear,” Egan said, but “will the environmental approval processes be fast enough and clear enough? How come it can happen so quickly in the US and it can’t happen so quickly in Canada? »

lgoldstein@postmedia.com