Energy
A Wealth-Creating Way of Reducing Global CO2 Emissions
From the C2C Journal
By Gwyn Morgan
It is Prime Minister Justin Trudeau’s contention there’s no “business case” for exporting Canada’s abundant, inexpensively produced natural gas as LNG. But Canadians might do well to politely decline management consulting advice from a former substitute drama teacher who was born into wealth and has never had to meet a payroll, balance a budget or make a sale. Bluntly stated, someone who has shown no evidence of being able to run the proverbial lemonade stand. And one whose real agenda, the evidence shows, is to strangle the nation’s most productive and wealth-generating industry. With the first LNG ship finally expected to dock at Kitimat, B.C. over the next year and load Canada’s first-ever LNG export cargo, Gwyn Morgan lays out the business and environmental cases for ramping up our LNG exports – and having them count towards Canada’s greenhouse gas reduction targets.
Pierre Poilievre’s Axe the (carbon) Tax campaign is a spectacular success. But the Conservative Party of Canada needs its own plan to reduce greenhouse gas emissions from fossil fuels. Paradoxically, it’s a fossil fuel that provides much of the answer.
Canada’s rich endowment of natural gas resources offers an immense opportunity to reduce global carbon dioxide (CO2) emissions while also helping to rescue the Liberal-government-ravaged Canadian economy by exporting liquefied natural gas (LNG) to China, Japan, South Korea and the other coal-dependent Asia-Pacific countries. Switching from coal to natural gas for producing electricity and generating heat for buildings and industrial processes can typically reduce CO2 emissions by 50 percent for the same unit of output, while all-but eliminating the toxic compounds and lung-clogging particulates emitted from burning coal that shorten the lives of millions living in smog-stricken Asian cities.
More natural gas is urgently needed, since countries throughout Asia – especially China and India – are currently adding even more coal-burning power plants to meet rapidly growing electricity demand. The benefits of fuel-switching are not speculation, but a proven result: the United States’ pronounced switch starting in the mid-2000s from coal to natural gas for electricity materially reduced that country’s CO2 emissions (see accompanying graph), nearly equalling the entire European Union’s emissions cuts, as I wrote about in this previous column.
A study by respected consulting firm Wood Mackenzie, released in late 2022, determined the following:
- “Canada is well-positioned geographically…Western Canadian LNG is much closer to Asia relative to US Gulf Coast LNG, which needs to be shipped through the Panama Canal to get to Asia”;
- “LNG from Canada would be cost-competitive for northeast Asian importers…due to its relatively low shipping and liquefaction costs”;
- “LNG from Canada has lower emissions intensity than LNG coming from many other global LNG exporters”;
- “Asia will not be able to produce enough natural gas domestically to meet its escalating demand, therefore Canadian LNG is a compelling alternative: With its high environmental standards and stewardship, Canada would be a great partner to fill the LNG demand gap in Asia”; and
- “If Canada aggressively ramps up its LNG exports…the emissions displaced from Canadian LNG would total 5.5 [gigatons of CO2 equivalent] from 2022 to 2050 or 181 [megatons of CO2 equivalent] on average per year, which is equivalent to removing all Canadian cars from the road.”
These impressive benefits – not to mention the opportunity to create tens of thousands of well-paying jobs in our country and provide long-term returns to investors, among them millions of pension-dependent retirees – were recognized long ago by the energy industry, Western provincial premiers and former prime minister Stephen Harper. And for a time it indeed seemed that Canada was on the cusp of an LNG boom. By 2010, there were more than 20 LNG projects in the works in B.C., representing hundreds of billions in total investment. These included Exxon Mobil’s $25-billion West Coast Canada project, Chinese-owned CNOOC’s $36-billion Aurora project, Malaysian firm Petronas’s $36 billion Pacific NorthWest project, and the Shell-led $43 billion LNG Canada project at Kitimat.
Aside from the jobs created and the wealth generated for the participating companies, B.C.’s annual natural gas royalties are forecast to double. Benefits for First Nations include significant employment and business opportunities, such as HaiSea Marine’s 50 percent interest in a $500 million contract.
But through a decade of trying to navigate Canada’s increasingly obstructive and Byzantine regulatory process, project proponents dropped out one by one. Today LNG Canada is the only one of those major projects left standing. (Two much smaller LNG projects, Woodfibre LNG in Howe Sound at Squamish, and Cedar LNG just a few kilometres from the LNG Canada project, are also proceeding, and one other large project proposed by the Nisga’a First Nation is making regulatory progress.) LNG Canada succeeded only because South African project leader Andy Calitz, backed by the enthusiasm of the Haisla Nation which saw the immense potential to create a self-sustaining, wealth-generating economy for its people, refused to give up.
After five years of construction, the LNG Canada liquefaction facility and loading terminal are nearing completion, with the first LNG ship scheduled to sail to China in 2025 (possibly even this year). The Kitimat plant itself is just one component of Canada’s first LNG export project. TC Energy Corp.’s (formerly TransCanada Pipelines) $15 billion, recently completed Coastal GasLink pipeline will carry the required natural gas from the northeastern B.C. gas fields to the Kitimat terminal. And additional billions of dollars have been invested in drilling natural gas wells, proving up the immense reserves needed to feed the LNG facility for decades to come, and constructing field production systems.
The economic benefits are myriad. Aside from the jobs created and the wealth generated for the participating companies, B.C.’s annual natural gas royalties are forecast to double from $700 million in 2024 to $1.4 billion in 2027. Benefits for First Nations include significant employment and business opportunities, such as HaiSea Marine’s 50 percent interest in a $500 million contract.
And that’s just LNG Canada’s Phase 1, which will produce 14 million tonnes per annum (mtpa) of LNG, or approximately 1.8 billion cubic feet (bcf) per day. With that one project coming on-stream, about 10 percent of Canada’s total natural gas production will be exported to international markets, earning premium prices. Construction of Phase 2 is scheduled to begin in 2026 and will double the facility’s output, with first delivery scheduled for 2032. A report from Canada Action estimates that completion of both phases will reduce CO2 emissions in Asian countries as much as would removing 18 million cars from Canadian roads. That is a far more efficient and realistic way of reducing emissions than the Trudeau government’s current scheme to force everyone into electric vehicles within a decade.
A major barrier for LNG project sponsors has been Canadian regulators’ fixation on a project’s domestic emissions – which come mainly from producing the energy needed to operate the liquefaction and storage process and loading facility. These emissions are miniscule compared to the enormous emissions reductions when natural gas is used instead of coal in consuming countries. But in their zeal to force Canada to “net zero” emissions, government authorities initially tried to veto LNG Canada generating its electricity and compression power using some of the natural gas that will be already piped to the site, insisting instead upon hydroelectric power. This seriously delayed the project due to the need for B.C. Hydro to first build a new dam to supply the required power, along with a new, $3 billion transmission line that has not even begun its environmental review process.
Regulators finally waived their objection so the project could be finished, and it will initially use natural gas for power. But the same objection is now being raised with respect to another major LNG venture proposed in the same region. The Ksi Lisims LNG project would utilize a floating liquefaction and loading facility docked at lands owned by the Nisga’a First Nation north of Prince Rupert. Its natural gas would be supplied through an already-approved but never-built pipeline planned for one of the cancelled LNG projects. The $10 billion venture would have approximately two-thirds the capacity of LNG Canada Phase 1. The facility would be powered by hydroelectricity.
Ksi Lisims sounds like a great addition to Canada’s modest LNG lineup, one that British Columbians should applaud. Instead, the proponents have been assailed by objections over the greenhouse gas emissions from the facility and the natural gas production process, and concurrently the B.C. Wilderness Committee is calling on the province’s NDP government to veto any further LNG development. None of these zealots acknowledge the vastly greater reduction of greenhouse gas emissions that will be achieved as consuming countries switch to natural gas.
Prior to the December 2018 UN Climate Change Conference in Katowice, Poland, Canada’s Conservative Party urged leaders of their nation’s delegation to propose that the use of imported natural gas to displace coal and thereby reduce emissions in one country should count towards the exporting country’s emissions reduction targets. But this made far too much sense for our Prime Minister and his team of anti-fossil-fuel eco-zealots. A new federal government that encourages LNG projects might well see a return of those other big sponsors that were driven off.
And that brings us back to Pierre Poilievre and the need for a Conservative alternative to Trudeau’s carbon tax. LNG export would be not only vastly superior in reducing emissions, it would also create tens of billions of dollars in economic benefits for a beleaguered Canadian private sector. It is beyond high time. A Macdonald-Laurier Institute report, Estimating the True Size of Government in Canada, concludes that Canada’s private sector has shrunk to just 36 percent of the nation’s GDP. That’s right – Canada’s public sector now represents nearly two-thirds of the Canadian economy, if one includes in that measure the vast amounts governments spend on tax credits and other tax-related expenditures, plus the economic impacts of regulating the pricing or outputs of private industries. This is appalling.
Even more incomprehensible is a research report from the Harvard Kennedy School noting that “Communist” China’s private sector generates “approximately 60% of China’s GDP, 70% of its innovative capacity, 80% of urban employment and 90% of new jobs.” By those measures, the private sector in ostensibly free and democratic Canada, with its allegedly market-based economy, has been reduced to barely half the relative size of the private sector in authoritarian China.
It is clear that for Canada, getting out of the way of privately-driven growth in LNG exports would be a vastly superior environmental alternative to Trudeau’s economically destructive and politically divisive carbon tax, while also helping to reverse the decline of what was once a proud, thriving nation into an indebted, unproductive, government-dominated basket case.
Gwyn Morgan is a retired business leader who was a director of five global corporations.
Energy
75 per cent of Canadians support the construction of new pipelines to the East Coast and British Columbia
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71 per cent of Canadians find the approval process too long.
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67 per cent of Quebecers support the Marinvest Energy natural gas project.
“While there has always been a clear majority of Canadians supporting the development of new pipelines, it seems that the trade dispute has helped firm up this support,” says Gabriel Giguère, senior policy analyst at the MEI. “From coast to coast, Canadians appreciate the importance of the energy industry to our prosperity.”
Three-quarters of Canadians support constructing new pipelines to ports in Eastern Canada or British Columbia in order to diversify our export markets for oil and gas.
This proportion is 14 percentage points higher than it was last year, with the “strongly agree” category accounting for almost all of the increase.
For its part, Marinvest Energy’s natural gas pipeline and liquefaction plant project, in Quebec’s North Shore region, is supported by 67 per cent of Quebecers polled, who see it as a way to reduce European dependence on Russian natural gas.
Moreover, 54 per cent of Quebecers now say they support the development of the province’s own oil resources. This represents a six-point increase over last year.
“This year again, we see that this preconceived notion according to which Quebecers oppose energy development is false,” says Mr. Giguère. “Quebecers’ increased support for pipeline projects should signal to politicians that there is social acceptability, whatever certain lobby groups might think.”
It is also the case that seven in ten Canadians (71 per cent) think the approval process for major projects, including environmental assessments, is too long and should be reformed. In Quebec, 63 per cent are of this opinion.
The federal Bill C-5 and Quebec Bill 5 seem to respond to these concerns by trying to accelerate the approval of certain large projects selected by governments.
In July, the MEI recommended a revision of the assessment process in order to make it swift by default instead of creating a way to bypass it as Bill C-5 and Bill 5 do.
“Canadians understand that the burdensome assessment process undermines our prosperity and the creation of good, well-paid jobs,” says Mr. Giguère. “While the recent bills to accelerate projects of national interest are a step in the right direction, it would be better simply to reform the assessment process so that it works, rather than creating a workaround.”
A sample of 1,159 Canadians aged 18 and older were surveyed between November 27 and December 2, 2025. The results are accurate to within ± 3.5 percentage points, 19 times out of 20.
This article supplied by Troy Media.
Oil markets are shrugging off war and sanctions, a sign that oversupply now matters more than disruption
Oil producers hoping geopolitics would lift prices are running into a harsh reality. Markets are brushing off wars and sanctions as traders focus instead on expectations of a deep and persistent oil glut.
That shift was evident last week. Despite several geopolitical developments that would once have pushed prices higher, including the U.S. seizure of a Venezuelan crude tanker and fresh Ukrainian strikes on Russian energy infrastructure, oil markets barely reacted, with prices ending the week lower.
Brent crude settled Friday at US$61.12 a barrel and U.S. West Texas Intermediate at US$57.44, capping a weekly drop of more than four per cent.
Instead of responding to disruption headlines, markets were reacting to a different risk. Bearish sentiment, rather than geopolitics, continued to dominate as expectations of a “2026 glut” took centre stage.
At the heart of that outlook is a growing supply overhang. The oil market is grappling with whether sanctioned Russian and Iranian cargoes should still be counted as supply. That uncertainty helps explain why prices have been slow to react to a glut that is already forming on the water, said Carol Ryan, writing for The Wall Street Journal.
The scale of that buildup is significant. There are 1.4 billion barrels of oil “on the water,” 24 per cent higher than the average for this time of year between 2016 and 2024, according to oil analytics firm Vortexa. These figures capture shipments still in transit or cargoes that have yet to find a buyer, a clear sign that supply is running ahead of immediate demand.
Official forecasts have reinforced that view. Last week, the International Energy Agency trimmed its projected 2026 surplus to 3.84 million barrels per day, down from 4.09 million barrels per day projected previously. Even so, the IEA still sees a large oversupply relative to global demand.
Demand growth offers little relief. The IEA expects growth of 830 kb/d (thousand barrels per day) in 2025 and 860 kb/d in 2026, with petrochemical feedstocks accounting for a larger share of incremental demand. That pace remains modest against the volume of supply coming to market.
OPEC, however, has offered a different assessment. In its latest report, the group pointed to a near balance, forecasting demand for OPEC+ crude averaging about 43 million barrels per day in 2026, roughly in line with what it produced in November.
Reflecting that confidence. OPEC+ kept policy steady late in November, pausing planned output hikes for the first quarter of 2026 while more than three million barrels per day of cuts remain in place. Those measures are supportive in theory, but markets have shown little sign of being persuaded.
Recent geopolitical events underline that scepticism. The ongoing Russia-Ukraine war and Ukrainian strikes on Russian energy infrastructure, including reported hits on facilities such as the Slavneft-YANOS refinery in Yaroslavl, again failed to lift prices. Russia-Ukraine headlines pulled prices down more than strikes lifted them, according to media reports, suggesting traders were more attuned to “peace deal” risk than to supply disruption.
Washington’s move against Venezuelan crude shipments offered another test. The U.S. seizure of a Venezuelan tanker, the first formal seizure under the 2019 sanctions framework, had a muted price impact, writes Marcin Frackiewicz of Oilprice.com.
Venezuela’s exports fell sharply in the days that followed, but markets remained largely unmoved. One explanation is that Venezuela’s output is no longer large enough to tighten global balances the way it once did, and that abundant global supply has reduced the geopolitical premium.
Taken together, the signal is hard to miss. Oil producers, including in Canada, face a reality check in a market that no longer rewards headlines, only discipline and demand.
Toronto-based Rashid Husain Syed is a highly regarded analyst specializing in energy and politics, particularly in the Middle East. In addition to his contributions to local and international newspapers, Rashid frequently lends his expertise as a speaker at global conferences. Organizations such as the Department of Energy in Washington and the International Energy Agency in Paris have sought his insights on global energy matters.
Troy Media empowers Canadian community news outlets by providing independent, insightful analysis and commentary. Our mission is to support local media in helping Canadians stay informed and engaged by delivering reliable content that strengthens community connections and deepens understanding across the country.
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