Energy
Supreme Court ruling on federal environmental law a step toward brighter industrial future
From the MacDonald Laurier Institute
By Heather Exner-Pirot
Now we need to build: to meet net-zero goals, to supply our allies with energy and critical minerals, to compete with the U.S. Inflation Reduction Act, to bolster our anemic economy – take your pick
In a strong rebuke to the federal government, the Supreme Court on Friday issued its long-awaited opinion on the constitutionality of the Impact Assessment Act (IAA). In a 5 to 2 decision, the majority found that the Liberal government’s regulations for major projects such as oil and gas operations and mines violate provincial jurisdiction.
The decision will have lasting impact. It is a piece of cautiously optimistic news for the industry, paving the way for realizing its greatest desire: to move away from concurrent and competing federal and provincial processes for project approval, toward a more efficient principle of one project, one assessment.
There will be immediate impacts, too. It’s hard to see how the Liberal government’s proposed clean electricity regulations and oil and gas emissions cap, which is contentious on similar grounds, can now be seen as constitutional.
In the wake of the decision on Friday, the federal government promised to amend the act. The decision provides good reason for the government to start looking at its other environmental regulations through the same lens.
The IAA, which became law in 2019 after contentious Senate hearings and months of public protests, is unpopular for wholly legitimate reasons. It duplicated and often competed with provincial processes for approving natural resources projects, adding time, money, confusion and risk for companies.
It also politicized the regulatory process, allowing the federal minister of environment and climate change to designate just about any resource project in the country for assessment, and then effectively veto it too. The results, if unchecked: a quiet quitting of investors and proponents who then move their capital to greener, more predictable pastures.
Even before the Supreme Court opinion on the IAA came out, the Liberals had promised to reform it. Friday’s decision gives the government additional impetus to do it properly.
The opportunity in those forthcoming amendments is not for the federal government to take bad, unconstitutional regulatory legislation and turn it into bad, constitutional legislation. The times demand much more. The act reflected an outdated way of thinking that saw the environment and Indigenous peoples as inherently needing to be protected from the provinces and the resource sector. But the world has changed.
Now we need to build: to meet net-zero goals, to supply our allies with energy and critical minerals, to compete with the U.S. Inflation Reduction Act, to bolster our anemic economy – take your pick. Where we once applied sticks to major energy and resource projects, we now need to offer carrots. This needs to be reflected in the amendments to the IAA.
In the Liberal government’s news conference responding to the opinion, Energy and Natural Resources Minister Jonathan Wilkinson expressed hope that this would be the last time the federal and provincial governments settled their differences in court, saying “Canada works best when Canadians work together.”
Let’s all hope that happens.
A large and critical part of Canada’s economy has found itself in the crosshairs of jurisdictional infighting. It has created polarization and uncertainty, and investors and proponents of projects abhor it. Our country needs and deserves a functional regulatory process – one that doesn’t just prevent bad projects, but advances good ones, too. The Supreme Court’s decision is an opening to create one.
Heather Exner-Pirot is director of energy, natural resources and environment at the Macdonald-Laurier Institute.
North Dakota Gov. Doug Burgum speaks to the Republican National Convention, July 17, 2024. (Screen Capture/CSPAN)
From the Daily Caller News Foundation
By Adam Pack
Senate Overwhelmingly Confirms Doug Burgum As Trump’s Interior Secretary
The Senate confirmed former North Dakota Gov. Doug Burgum in a bipartisan fashion to lead President Donald Trump’s Department of Interior Thursday evening.
Senators overwhelmingly approved Burgum’s nomination 79 to 18. Three senators did not vote. Under the prior administration, we went from a nation of energy dominance to a nation of energy dependence.
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America is an energy superpower. We should act like it. @DougBurgum and @ChrisAWright_ are America’s energy all-stars. I strongly support their nominations. pic.twitter.com/3o4xuan31r
— Sen. John Barrasso (@SenJohnBarrasso) January 30, 2025
Senate Republicans endorsed Burgum’s nomination, saying he was committed to reversing the work of his predecessor, former Interior Secretary Deb Haaland, to restrict energy resources. Haaland worked to block oil and gas leasing in development in Alaska.
“Governor Burgum knows that America’s natural resources are our greatest national asset,” Senate Majority Leader John Thune said Wednesday on the Senate floor prior to Burgum’s confirmation vote. “Too often, under the Biden administration, the Interior Department was the tip of the spear in restricting development of America’s resources.”
Burgum promised to prioritize energy abundance during his leadership over the Interior Department.
“The American people clearly placed their confidence in President Trump to achieve Energy Dominance,” Burgum wrote in his opening remarks to the Senate Energy and Natural Resources (ENR) Committee during his confirmation hearing on Jan 16. “Energy Dominance is the foundation of historic American prosperity, affordability for American families, and unrivaled national security.”
“President Trump’s Energy Dominance vision will end wars abroad and make life more affordable for every family by driving down inflation,” Burgum added. “President Trump will achieve these goals while championing clean air, clean water, and our beautiful land.”
Burgum won the support of a majority of Senate Democrats, including Democratic New Mexico Sen. Martin Heinrich who serves as the lead Democrat on the Senate ENR Committee.
“I clearly do not agree with Governor Burgum on every issue,” Heinrich wrote in a statement on Jan. 23. “However, I voted to confirm Governor Burgum’s nomination for Interior Secretary because I have found that a healthy relationship with the Secretary of Interior is critical to securing the best outcomes for the State of New Mexico.”
Trump has tasked Burgum with leading a newly-created interagency National Energy Council to cut regulations affecting the energy sector and harness private sector investment related to energy innovation. The president also appointed Burgum to a seat on the National Security Council, a rare appointment for an energy secretary.
Burgum served two terms as North Dakota’s governor beginning in December 2016. He launched a presidential run in June 2023, but struggled to gain traction and suspended his campaign that December. He endorsed Trump in January 2024 and served as a campaign surrogate throughout the remainder of the race.
Thune teed up confirmation votes Thursday evening on energy executive Chris Wright to lead the Department of Energy and former Republican Georgia Rep. Doug Collins to lead the Department of Veterans’ Affairs.
From the Canadian Energy Centre
Complementary production in Canada and the U.S. boosts energy security
The United States is now the world’s largest oil producer, but its reliance on oil imports from Canada has never been higher.
Through a vast handshake of pipelines and refineries, Canadian oil and U.S. oil complement each other, strengthening North American energy security.
Here’s why.
Decades in the making
Twenty years ago, the North American energy market looked a lot different than it does today.
In the early 2000s, U.S. oil production had been declining for more than 20 years. By 2005, it dropped to its lowest level since 1949, according to the U.S. Energy Information Administration (EIA).
America’s imports of oil from foreign nations were on the rise.
But then, the first of two powerhouse North American oil plays started ramping up.
In Canada’s oil sands, a drilling technology called SAGD – steam-assisted gravity drainage – unlocked enormous resources that could not be economically produced by the established surface mining processes. And the first new mines in nearly 25 years started coming online.
In about 2010, the second massive play – U.S. light, tight oil – emerged on the scene, thanks to hydraulic fracturing technology.
Oil sands production jumped from about one million barrels per day in 2005 to 2.5 million barrels per day in 2015, reaching an average 3.5 million barrels per day last year, according to the Canada Energy Regulator.
Meanwhile, U.S. oil production skyrocketed from 5.5 million barrels per day in 2005 to 9.4 million barrels per day in 2015 and 13.3 million barrels per day in 2024, according to the EIA.
Together the United States and Canada now produce more oil than anywhere else on earth, according to S&P Global.
As a result, overall U.S. foreign oil imports declined by 35 per cent between 2005 and 2023. But imports from Canada have steadily gone up.
In 2005, Mexico, Saudi Arabia, Venezuela and Nigeria together supplied 52 per cent of U.S. oil imports. Canada was at just 16 per cent.
In 2024, Canada supplied 62 per cent of American oil imports, with Mexico, Saudi Arabia and Venezuela together supplying just 14 per cent, according to the EIA.
“Light” and “heavy” oil
Canadian and U.S. oil production are complementary because they are different from each other in composition.
Canada’s oil exports to the U.S. are primarily “heavy” oil from the oil sands, while U.S. production is primarily “light” oil from the Permian Basin in Texas and New Mexico.
One way to think of it is that heavy oil is thick and does not flow easily, while light oil is thin and flows freely – like orange juice compared to fudge.
The components that make the oil like this require different refinery equipment to generate products including gasoline, jet fuel and base petrochemicals.
Of the oil the U.S. imported from Canada from January to October last year, 75 per cent was heavy, six per cent was light, and the remaining 19 per cent was “medium,” which basically has qualities in between the two.
Tailored for Canadian crude
Many refineries in the United States are specifically designed to process heavy oil, primarily in the U.S. Midwest and U.S. Gulf Coast.
Overall, there are about 130 operable oil refineries in the United States, according to the American Fuel and Petrochemical Manufacturers.
The Alberta Petroleum Marketing Commission (APMC) estimates that 25 consistently use oil from Alberta.
According to APMC, the top five U.S. refineries running the most Alberta crude are:
- Marathon Petroleum, Robinson, Illinois (100% Alberta crude)
- Exxon Mobil, Joliet, Illinois (96% Alberta crude)
- CHS Inc., Laurel, Montana (95% Alberta crude)
- Phillips 66, Billings, Montana (92% Alberta crude)
- Citgo, Lemont, Illinois (78% Alberta crude)
Since 2010, virtually 100 per cent of oil imports to the U.S. Midwest have come from Canada, according to the EIA.
In recent years, new pipeline access and crude-by-rail have allowed more Canadian oil to reach refineries on the U.S. Gulf Coast, rising from about 140,000 barrels per day in 2010 to about 450,000 barrels per day in 2024.
U.S. oil exports
The United States banned oil exports from 1975 to the end of 2015. Since, exports have surged, averaging 4.1 million barrels per day last year, according to the EIA.
That is nearly equivalent to the 4.6 million barrels per day of Canadian oil imported into the U.S. over the same time period, indicating that Canadian crude imports enable sales of U.S. oil to global markets.
Future outlook
Twenty-five years from now, the U.S. will need to import virtually exactly the same amount of oil as it does today (7.0 million barrels per day in 2050 compared to 6.98 million barrels per day in 2023), according to the EIA.
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