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The inability to diversify our energy markets is jeopardizing Canada’s prosperity. Quebec’s application to have an injunction on the Energy East pipeline, First Ministers’ divided thoughts about a national carbon tax and Leonardo DiCaprio’s Academy Award confusion of a Chinook with global warming would be the latest sundry developments impinging on this critical problem. Pipeline construction is stymied by politics and undergoing contested regulatory reviews, preventing transport of oil to eastern Canada or to tidewater and tankers to foreign markets. As a result of a relentless campaign waged by well-funded opponents, public opinion has moved from belief in exaggerated claims about environmental risk to toleration of the damaging consequences of inaction, to the cusp of capitulation towards the truly mad – an energy powerhouse abandoning energy exports. That would be a historic blunder.
To understand our predicament and just what to do about this, let’s examine the facts and set out some good sense realities.
Canada has enormous oil and gas reserves, that will exceed domestic requirements for years and years. The International Energy Agency forecasts almost 75 per cent of worldwide energy demand will come from non-renewable fuels in 2040. However, our only export marketplace is the U.S., which buys our gas and oil at a multi-billion dollar discount towards the international price. Moreover, it needs less due to its massive shale discoveries, in the end have to export more because of our increased production. But if we cannot deliver outside North America, it’s irrelevant that most around the globe is energy-deficient. On the line are tens of thousands of jobs and many vast amounts of dollars in revenue to governments for healthcare, education and infrastructure.
The only rational reason behind not doing everything easy to export our oil is significant environmental risk. Determining that risk is the responsibility of independent regulators who conduct comprehensive scientific reviews and consult broadly. As to global GHG emissions, Canada represents an insignificant 1.6 percent and the oilsands a minuscule 0.01 per cent. Offsetting that meagre amount could be helped by replacing transport by rail with safer pipelines and exporting our gas and oil to reduce coal burning worldwide.
The pm has got the opportunity for a Nixon-in-China breakthrough.
Let’s not be duped by foreign rhetoric that’s contradicted by facts on the ground. President barack obama bolstered his green cred by turning down the Keystone XL pipeline. Yet he is pleased to begin to see the construction of so many domestic U.S. pipelines under his watch that their length would encircle the world, and he approved American oil exports following a 40-year hiatus. Heavy Mexican crude is eating into our diminishing U.S. share of the market. The U.K. is aggressively developing its shale industry. The Saudis ship crude in tankers up the St. Lawrence River, even as Alberta tries to convince Quebec politicians to simply accept domestic oil. Iran is gearing up production since sanctions are lifted. Everywhere, energy exporters are busily capturing share of the market, including the market of our own country. Meanwhile, Canada cannot get its act together.
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Canada would not be the nation it is today if consensus was really a precondition to progress. Dissenting views should be seriously considered, however, if opponents are NIMBYs or ideologues who ignore science, the nation’s interest should prevail.
Not every environmental group is adamantly opposed to resource development. However, several clearly are, that we called focus on when I was minister of natural resources. Regardless of a hyperbolic feeding frenzy over my comments, the following 4 years repeatedly proved my point. Indeed, I cannot name just one major resource project these radical groups do support, even those with regulatory approval. It is a fool’s errand to try and change their minds. Appeasement merely feeds defiance.
What should the federal government do? Take away the moratorium on oil-tanker traffic off B.C.’s north coast. Consider support for that construction of a B.C. upgrader or refinery, perhaps having a government guarantee. Facilitate aboriginal economic participation. Restrain regulatory duplication, scope creep and dilatory tactics. Advocate for pipeline projects if and when an independent regulator recommends approval. Critically, communicate to Canadians the facts and urgency of the issue.
The prime minister has the opportunity for a Nixon-in-China breakthrough. Instead of abdicate leadership as a “responsible referee” (shades of honest broker?), Justin Trudeau should emulate the current U.S. president, who extolled green policies even while the U.S. became the world’s biggest oil producer. The Liberal government’s high-profile concern about climate change supplies a comparable opening to aid pipeline development.
Trudeau has a chance for nation building. Otherwise, he risks abandoning a legacy of missed opportunities and economic decline. Science, economics, national security and customary sense all support opening our energy markets around the world.
Joe Oliver may be the former minister of finance and former minister of natural resources.
