Economy
Fossil fuels aren’t going anywhere, we benefit too much from them
From the MacDonald Laurier Institute
By Chris Sankey
Indigenous people are finally reaping the rewards.
Over the last eight years we have experienced an unprecedented push from environmental activists to phase out fossil fuels. The Government of Canada seems to think it is possible. During question period in the Senate earlier this year, Sen. David Wells noted that, according to the Liberals, the energy transition “will cost $100-$125 billion per year at least to 2050,” and asked “When Canada only emits 1.5 per cent of global emissions, how does this expenditure make sense?”
Let me repeat that. $125 billion each year.
Who is going to pay for this? This is simply not possible, unless people want to see the Canadian economy in ruins.
Without fossil fuels, life as we know it would not be possible. State-of-the-art lifesaving medical equipment comes from fossil fuels and critical minerals from mining. Critical infrastructure, vehicles, planes, trains, container ships, ferries, and the billions of household necessities we buy from Canadian Tire, Walmart, Amazon and Ikea come from fossil fuels and help us function in our everyday lives. Without these needs we simply do not prosper.
Take for instance the environmental marches we see on our streets. The protesters seemingly have zero understanding of what makes their marches possible? Yes, fossil fuels. If you are going to protest for “Just Stop Oil,” then climate activists have to stop blocking traffic, because an idling vehicle is so much harder on the environment. And what about showing up in clothing and holding up signs made of hydrocarbons demonstrates your commitment to saving the planet? Hypocrisy? Absolutely.
From the moment we come out of our mother’s body, fossil fuels make our lives better. From cradle to grave, our lives are intertwined with fossil fuels. Just think of the act of giving birth. Chances are the mother was rushed to hospital in an ambulance, helicopter, plane, your personal vehicle, or taxi. As grandparents, siblings, uncles, aunts and cousins arrive at the hospital in their fossil fuel-powered cars and trucks smiling ear to ear welcoming the new baby to the family. They show up with gifts likely made from fossil fuels and critical minerals. If it is not made from fossil fuels, they were most definitely transported to the store using fossil fuels.
It is time we stop kidding ourselves that we can step away from the oil and gas wealth upon which our country benefits so much.
Only now, it will be Indigenous communities who are going to lead the multi-billion-dollar opportunity and put Canada at the front of global markets as a preferred supplier. For far too long, activist’s voice have been the determining factor in how governments make decisions on this necessary industry in our territories.
We need to make sure we have a framework that lays out a technology transition where we produce cleaner oil and gas by using new technology that will reduce emissions and grow our economies.
Since the Liberals were elected in 2015 everywhere we turn, our resource sector is being badly hurt. Forestry, fishing, oil and gas are screaming for more production, but federal regulations threaten to not only destroy the energy industry, but all industries with the emissions cap. Renewables are costing taxpayers billions in subsidies and it will not end there.
Indigenous people have always took care of the environment and grown our economies. From fishing, logging, farming and hunting, we used fossil fuels to make it happen.
Obviously, humans did not use fossil fuels prior to the industrial revolution and indigenous people made hunting weapons out of wood and stone. Life was challenging for our ancestors back then; life expectancy was short for all people.
Over time, technology in the energy sector changed for the better. I would be remiss if I did not include the fact that industry did not always have modern clean tech; emissions were high and cancer-causing effects were widespread. That introduced chemicals foreign to indigenous people. Like all things, newer and safer technology emerged. Making life much easier and convenient.
However, historically speaking indigenous people lived on fat and protein. Everything we ate was natural. Like all things that come and go, European contact forever changed our way of life. We were greatly impacted in every possible manner, from social, cultural, status and creed. But like we always have, we persevered like our ancestors wanted us too.
This is our turn to take our rightful place on the global stage. We are watching it play out in real time around the world. Energy and food security is the number one priority around the world. Indigenous communities near and far are leading the way in the pursuit of sustainable development, but government and activists are hindering our ability to progress.
It is important that Canadians be realistic when it comes to the use of oil and gas. All of us want to leave our planet better for the next generation. To do so, we must manage expectations. Many countries are just now finally transitioning to oil and gas from more environmentally harmful coal and countries like India will not be carbon neutral until 2070 or later.
Our country has an abundance of resources that the world wants. They are literally knocking on our door to get access to our wealth. We can help countries like China, India and Indonesia move away from burning coal and wood, and thereby help lift millions out of certain poverty, and improve their health.
New climate change technology has emerged in the energy sector, such as carbon capture and storage that will reduce and eliminate emissions and the need for diluent in oil pipelines. Our combination of Indigenous knowledge and history to the land makes for a stronger argument to partner with Indigenous communities. Alignment amongst indigenous communities is key to securing a project. Proper alignment will de-risk a project and attract investment and industry to the table where we will have a seat and even equity.
Engagement with Indigenous communities is the solution. The vast majority of our people are not against development. We are only against development when we are excluded from the opportunities, or if the evaluation process was developed without Indigenous input.
It is not rocket-science. Include the people whose territory you want to build on. This is an opportunity to build relationships through meaningful dialogue and trust. We must have nation to nation dialogue and build leadership to leadership relationships. No hidden agendas, just up-front, honest conversations about oil and gas and the costs and benefits of development.
I am tired of watching our people struggle. Our people do not want to watch the prosperity boat sail by Poverty Island. Markets do not wait for anyone. We cannot keep waiting for the right time. We cannot keep waiting for life to get better. First Nations can make it better by being at the economic table where our people can bring traditional knowledge to industry and make decisions in the best interests of our communities. Whether we agree or not in the first instance, we need to be in the room working towards a brighter future, because at the end of the day we all need rubber boots too.
Chris Sankey is a Senior fellow at the MacDonald Laurier Institute, a former Elected Councilor for the Lax Kw Alaams Band and Businessman.
Alberta
Carney government’s anti-oil sentiment no longer in doubt
From the Fraser Institute
The Carney government, which on Monday survived a confidence vote in Parliament by the skin of its teeth, recently released a “second tranche of nation-building projects” blessed by the Major Projects Office. To have a chance to survive Canada’s otherwise oppressive regulatory gauntlet, projects must get on this Caesar-like-thumbs-up-thumbs-down list.
The first tranche of major projects released in September included no new oil pipelines but pertained largely to natural gas, nuclear power, mineral production, etc. The absence of proposed oil pipelines was not surprising, as Ottawa’s regulatory barricade on oil production means no sane private company would propose such a project. (The first tranche carries a price tag of $60 billion in government/private-sector spending.)
Now, the second tranche of projects also includes not a whiff of support for oil production, transport and export to non-U.S. markets. Again, not surprising as the prime minister has done nothing to lift the existing regulatory blockade on oil transport out of Alberta.
So, what’s on the latest list?
There’s a “conservation corridor” for British Columbia and Yukon; more LNG projects (both in B.C.); more mineral projects (nickel, graphite, tungsten—all electric vehicle battery constituents); and still more transmission for “clean energy”—again, mostly in B.C. And Nunavut comes out ahead with a new hydro project to power Iqaluit. (The second tranche carries a price tag of $58 billion in government/private-sector spending.)
No doubt many of these projects are worthy endeavours that shouldn’t require the imprimatur of the “Major Projects Office” to see the light of day, and merit development in the old-fashioned Canadian process where private-sector firms propose a project to Canada’s environmental regulators, get necessary and sufficient safety approval, and then build things.
However, new pipeline projects from Alberta would also easily stand on their own feet in that older regulatory regime based on necessary and sufficient safety approval, without the Carney government additionally deciding what is—or is not—important to the government, as opposed to the market, and without provincial governments and First Nations erecting endless barriers.
Regardless of how you value the various projects on the first two tranches, the second tranche makes it crystal clear (if it wasn’t already) that the Carney government will follow (or double down) on the Trudeau government’s plan to constrain oil production in Canada, particularly products derived from Alberta’s oilsands. There’s nary a mention that these products even exist in the government’s latest announcement, despite the fact that the oilsands are the world’s fourth-largest proven reserve of oil. This comes on the heels on the Carney government’s first proposed budget, which also reified the government’s fixation to extinguish greenhouse gas emissions in Canada, continue on the path to “net-zero 2050” and retain Canada’s all-EV new car future beginning in 2036.
It’s clear, at this point, that the Carney government is committed to the policies of the previous Liberal government, has little interest in harnessing the economic value of Canada’s oil holdings nor the potential global influence Canada might exert by exporting its oil products to Asia, Europe and other points abroad. This policy fixation will come at a significant cost to future generations of Canadians.
Business
Nearly One-Quarter of Consumer-Goods Firms Preparing to Exit Canada, Industry CEO Warns Parliament
Standing Committee on Industry and Technology hears stark testimony that rising costs and stalled investment are pushing companies out of the Canadian market.
There’s a number that should stop this country cold: twenty-three percent. That is the share of companies in one of Canada’s essential manufacturing and consumer-goods sectors now preparing to withdraw products from the Canadian market or exit entirely within the next two years. And this wasn’t whispered at a business luncheon or buried in a consultancy memo. It was delivered straight to Parliament, at the House of Commons Standing Committee on Industry and Technology, during its study on Canada’s underlying productivity gaps and capital outflow.
Michael Graydon, the CEO of Food, Health & Consumer Products of Canada, didn’t hedge or soften the message. He told MPs, “23% of our members expect to exit products from the Canadian marketplace within the next two years, because the cost of doing business here has just become unsustainable.”
Unsustainable. That’s the word he used. And when the people who actually make things in this country start using that word, you should pay attention. These aren’t fringe players or hypothetical startups. These are firms that supply the goods Canadians buy every single day, and they’re looking at their balance sheets, their regulatory burdens, the delays in getting anything approved or built, and concluding that Canada simply doesn’t work for them anymore.
What makes this more troubling is the timing. Canada’s investment levels have been falling for years, even as the United States and other competitors race ahead. Businesses aren’t reinvesting in machinery or technology at the rate they once did. They’re not modernizing their operations here. They’re putting expansion plans on hold or shifting them to jurisdictions that move faster, cost less and offer clearer rules. That’s not ideology; it’s arithmetic. If it costs more to operate here, if it takes longer to get a permit, and if supply chains back up because ports and rail lines are jammed, investors will choose the place that doesn’t make growth a bureaucratic mountain climb.
Graydon raised another point that ought to concern anyone who cares about domestic production. Canada’s agrifood sector recorded a sixty-billion-dollar trade surplus last year, one of the brightest spots in the national economy, but according to him that potential is being “diluted by fragmented interprovincial trade and logistics bottlenecks.” The ports, the rail corridors, the entire transport network—choke points everywhere. And you can’t build a productive economy on choke points. Companies can’t scale, can’t guarantee delivery, can’t justify the costs. So they leave.
This twenty-three percent figure is the clearest evidence yet that the problem isn’t theoretical. It’s not something for think-tank panels or academic papers. It is happening at the level that matters most: the decision whether to continue doing business in Canada or move operations somewhere more predictable. And once those decisions are made, they’re very hard to reverse. Capital doesn’t boomerang back out of patriotism. It goes where it can earn a return.
For years, Canadian policymakers have talked about productivity as if it were a moral failing of workers or a mystical national characteristic. It’s neither. Productivity comes from investment—real money poured into equipment, technology, training and expansion. When investment stalls, productivity collapses. And when a quarter of firms in a major sector are already planning their exit, you are not looking at a temporary dip. You are looking at a structural rejection of the business environment itself.
The fact that executives are now openly warning Parliament that they cannot afford to stay is a moment of clarity. It is also a test. Either this country becomes a place where people can build things again—quickly, affordably, competitively—or it continues down the path that leads to empty factories, hollowed-out supply chains and consumers who wonder why the shelves look thinner every year.
Twenty-three percent is not just a statistic. It’s the sound of a warning bell ringing at full volume. The only question now is whether anyone in charge hears it.
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