A Wealth-Creating Way of Reducing Global CO2 Emissions

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.

All I need is the air that I breathe: Switching from coal to natural gas for generating electricity and heat can virtually eliminate toxic air particulates – which is urgently needed in polluted Asian cities such as Anyang City, China (pictured at top left) – while cutting carbon dioxide emissions in half for the same unit of output. The U.S. track record from fuel-switching (depicted in the graph at top right) proves this point. But for now, Asian countries keep piling on coal-fired power plants. (Source of top left photo: vtpoly, licensed under CC BY-NC-ND 2.0)

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.

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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.

Among numerous large liquefied natural gas (LNG) projects that were once proposed for Canada, only the LNG Canada facility at Kitimat, B.C. (top) has survived the Byzantine regulatory process and the Government of Canada’s increasing hostility to LNG; it is currently nearing completion and may load its first ship by year-end. At bottom, the Coastal GasLink pipeline will supply natural gas from northeast B.C.’s producing fields. (Sources of photos: (top) LNG Canada; (bottom) Coastal GasLink)

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 CO₂emissions 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.

Efficient and realistic: The completion of LNG Canada’s Phase 1 and Phase 2 by 2032 is expected to reduce greenhouse gas emissions in Asia by the same amount as removing 18 million gasoline-powered cars from Canadian roads – but without the staggering cost and disruption of forcing Canadians into electric vehicles. (Source of photo: James D. Schwartz, licensed under CC BY-ND 2.0)

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.

The Ksi Lisims LNG project (pictured in the digital rendering at left), a floating facility proposed to be built north of Prince Rupert and to operate on hydroelectricity, has faced strong objections over its natural gas production process, with the B.C. Wilderness Committee (right) calling on B.C.’s NDP government to veto any further LNG development. (Source of right photo: Behda Mahichi, retrieved from Wildeness Commitee)

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.

Canadian Conservative leader Pierre Poilievre’s “Axe the Tax” campaign can be part of a much-needed conversation about how to actually reduce CO₂ emissions and boost the country’s economy; LNG export could be part of both solutions. (Source of photo: The Canadian Press/Paul Daly)

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.

Related Topics:#C2CJournal #CanadaLNG #GwynMorgan #WealthCreatingWayOfReducingGlobalCO2Emissions feature

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Energy security matters more than political rhetoric

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Canada’s sudden rediscovery of energy ambition has been greeted with a familiar charge: hypocrisy

Energy

Energy security matters more than political rhetoric

Published on December 16, 2025

Todayville

From Resource Works

By Stewart Muir

If we force a transition that increases the cost of living, threatens grid reliability, and denies developing nations the dense energy they need to rise out of poverty, what have we actually achieved?

Finance expert warns that political timelines for transition defy the laws of physics and economics while threatening living standards.

In the polarized world of energy policy, it is becoming increasingly difficult to find conversations that prioritize practical reality over political idealism. We are often presented with a binary choice: either you are for the planet, or you are against it. But as I often find when digging deeper into these issues on the Power Struggle podcast, the real world is far too complex for such simple narratives.

I recently had the opportunity to sit down with Jerome Gessaroli to strip away the rhetoric and look at the hard numbers. For those who don’t know him, Gessaroli is a finance professor at the British Columbia Institute of Technology, a senior fellow with the Macdonald-Laurier Institute, and a valued member of the Resource Works Advisory Council. He is a thinker who deals in data, not daydreams.

Stewart Muir with Jerome Gesaroli on Power Struggle Podcast

Our conversation focused on a topic that makes many policymakers uncomfortable: the widening gap between our energy transition targets and the physical capacity to meet them.

The Fundamental Equation

We began with a premise that should be obvious but is frequently forgotten in the halls of government in Ottawa or Brussels. Gessaroli laid it out as a fundamental fact that underscores every economic decision a nation makes.

“There is a direct link, a direct correlation, between energy consumption and living standards,” Gessaroli told me. “And so if we expect to improve our living standards in the future, then we will likely be expending more energy.”

This is the inescapable equation of modern life. In the West, where we have enjoyed stable grids and abundant fuel for a century, we sometimes delude ourselves into thinking we can maintain our prosperity while shrinking our energy footprint. But globally, the trend is moving in the opposite direction.

Gessaroli pointed out that while we debate carbon taxes and caps here, the majority of the planet is focused on survival and advancement.

“A lot of the growth in energy consumption will be through the Third World,” he explained. “They’ve just got a huge population, and they want to pursue economic growth, have a better standard of living, and that will require a lot more energy.”

The View from the Developing World

To illustrate this, Gessaroli drew on his observations from India. He described seeing farmers burning dung to create heat and energy—a practice born of necessity, but one that traps populations in poverty and creates localized health hazards. The path out of that poverty isn’t found in wishful thinking; it’s found in density.

“Now, if they expect to have a better standard of living in the future . . . they’re going to be looking at more intensive sources of energy, like coal, natural gas, nuclear, whatever,” Gessaroli said. “They need to use more energy in order to raise their living standards.”

This brings us to one of the most contentious points in the global climate dialogue. We often hear Western politicians ask, with a mix of confusion and frustration, why nations like China and India are still building new coal-power plants. If the technology for wind and solar exists, why aren’t they leaping straight to it?

I found Gessaroli’s answer to be a necessary dose of realism. It isn’t that these nations hate the environment; it’s that they love stability.

“They know how to do it extremely efficiently. They have the local domestic sources,” Gessaroli noted, referring to coal reserves. “There’s a source of energy security in that they don’t have to import the product.”

In an era of geopolitical instability, energy security is national security. Relying on domestic coal provides a safety net that imported fuels or intermittent renewables cannot yet match. As Gessaroli put it: “The type of power that is generated by a coal plant, for instance, is stable, reliable power.”

The Timeline Mismatch

This doesn’t mean the world isn’t changing. It is. Gessaroli was quick to acknowledge that the green energy sector is booming. Innovation is happening. But there is a massive disconnect between the pace of engineering and the pace of political promises.

“There is a lot of growth in terms of other types of energy production. They’re growing quite rapidly and they’re improving over time,” Gessaroli said. “But it’s just not in line with the time frames that our politicians and policymakers are telling us that the targets have to be met by.”

This is the crux of the “power struggle.” We are being sold a vision of the future with a delivery date that defies the laws of physics and economics.

The EV Challenge and the Scale of Site C

Perhaps nowhere is this disconnect more visible than in the push for electric vehicles (EVs). Governments are setting aggressive target dates to ban the sale of internal combustion engines. On paper, it looks like a victory for the climate. But as a finance professor, Gessaroli looks at the balance sheet of power generation.

“What they don’t realize is the activity, the investment, required to actually make that happen,” he said. “Where is all that extra power going to come from?”

This is not a rhetorical question. It is a logistical nightmare. To put it in a local context, we looked at British Columbia. We have just spent years and billions of dollars completing the Site C hydro dam, a massive engineering project designed to secure our grid for the future.

However, Gessaroli’s calculations suggest that the new power demand from a full EV transition alone means we would need two times the amount of power currently generated by the new Site C hydro dam.

Let that sink in. It took us decades of planning, regulatory hurdles, and construction to build one Site C. To meet the government’s EV mandates, we effectively need to build two more, immediately. And that doesn’t even account for the rest of the economy.

“If we want to decarbonize mines and other industrial projects as well, then we’re going to have to find the extra power,” Gessaroli added.

If we cannot build the generation capacity in time, the demand will simply outstrip supply. Prices will skyrocket, and reliability will plummet.

The Unintended Consequences

Towards the end of our discussion, Gessaroli posed a question that has stuck with me. It challenges the moral high ground often claimed by the most aggressive climate activists.

If we force a transition that increases the cost of living, threatens grid reliability, and denies developing nations the dense energy they need to rise out of poverty, what have we actually achieved?

It all leads to his key question: What if the green revolution is hurting the people it aims to protect?

It is a question that deserves an honest answer, not more slogans. As we look toward a future of increased energy demand, we need to listen to experts like Gessaroli who understand that you cannot legislate your way around the laws of thermodynamics.

Watch the video on Power Struggle

Resource Works News

Energy

Canada’s sudden rediscovery of energy ambition has been greeted with a familiar charge: hypocrisy

Published on December 16, 2025

Todayville

From Resource Works

By Stewart Muir

Carney didn’t betray climate ambition. He confronted reality

Playing politics with pipelines is a time-honored Canadian tradition. Recent events in the House of Commons offered a delightful twist on the genre.

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The Conservatives introduced a motion quoting the Liberals’ own pipeline promises laid out in the Memorandum of Understanding (MOU) with Alberta, nearly verbatim. The Liberals, true to form, killed it 196–139 with enthusiastic help from the NDP, Bloc, and Greens.

We all knew how this would end. Opposition motions like this never pass; no government, especially not one led by Mark Carney, is going to let the opposition dictate the agenda. There’s not much use feigning outrage that the Liberals voted it down. The more entertaining angle has been watching closely as Liberal MPs twist themselves into pretzels explaining why they had to vote “no” on a motion that cheers on a project they claim to support in principle.

Liberal MP Corey Hogan dismissed the motion as “game-playing” designed to “poke at people”.

And he’s absolutely right to call it a “trap” for the Liberals. But traps only work when you walk into them.

Indigenous Services Minister Mandy Gull-Masty deemed the motion an “immature waste of parliamentary time” and “clearly an insult towards Indigenous Peoples” because it didn’t include every clause of the original agreement. Energy Minister Tim Hodgson decried it as a “cynical ploy to divide us” that “cherry-picked” the MOU.

Yet the prize for the most tortured metaphor goes to the prime minister himself. Defending his vote against his own pipeline promise, Carney lectured the House that “you have to eat the entire meal, not just the appetizer.”

It’s a clever line, and it also reveals the problem. The “meal” Carney is serving is stuffed with conditions. Environmental targets or meaningful engagement with Indigenous communities aren’t unrealistic asks. A crippling industrial carbon price as a precondition might be though.

But the prime minister has already said the quiet part out loud.

Speaking in the House a few weeks ago, Carney admitted that the agreement creates “necessary conditions, but not sufficient conditions,” before explicitly stating: “We believe the government of British Columbia has to agree.”

There is the poison pill. Handing a de facto veto to a provincial government that has spent years fighting oil infrastructure is neither constitutionally required nor politically likely. Elevating B.C.’s “agreement” to a condition, which is something the MOU text itself carefully avoids doing, means that Carney has made his own “meal” effectively inedible.

Hodgson’s repeated emphasis that the Liberal caucus supports “the entire MOU, the entire MOU” only reinforces this theory.

This entire episode forces us to ask whether the MOU is a real plan to build a pipeline, or just a national unity play designed to cool down the separatist temperature in Alberta. My sense is that Ottawa knew they had to throw a bone to Premier Danielle Smith because the threat of the sovereignty movement is gaining real traction. But you can’t just create the pretense of negotiation to buy time.

With the MOU getting Smith boo’ed at her own party’s convention by the separatists, it’s debatable whether that bone was even an effective one to throw.

There is a way. The federal government has the jurisdiction. If they really wanted to, they could just do it, provided the duty to consult with and accommodate Indigenous peoples was satisfied. Keep in mind: no reasonable interpretation equates Section 35 of the Charter to a veto.

Instead, the MOU is baked with so many conditions that the Liberals have effectively laid the groundwork for how they’re going to fail.

With overly-hedged, rather cryptic messaging, Liberals have themselves given considerable weight to a cynical theory, that the MOU is a stalling tactic, not a foundation to get more Canadian oil to the markets it’s needed in. Maybe Hodgson is telling the truth, and caucus is unified because the radicals are satisfied that “the entire MOU” ensures that a new oil pipeline will never reach tidewater through BC.

So, hats off to the legislative affairs strategists in the Conservative caucus. The real test of Carney’s political power continues: can he force a caucus that prefers fantasy economics into a mold of economic literacy to deliver on the vision Canadians signed off on? Or will he be hamstrung trying to appease the radicals from within?

Margareta Dovgal is managing director of Resource Works Society.