From the Fraser Institute

By Jason Clemens and Tegan Hill

Prime Minister Carney unveiled his new cabinet and did post-announcement media but failed to provide the clarity about his government’s actual views on resource development, particularly oil and natural gas. This uncertainty continues to impede private-sector investment, which our country badly needs.

Uncertainty is an investment killer because it makes it almost impossible for entrepreneurs, businesses and investors to reasonably weigh the risks, potential benefits and hurdles of a potential investment. A broadly recognized measure of uncertainty shows Canadian uncertainty at historic levels. The average monthly uncertainty measure between January 1985, when the data series began and December 2019 just before COVID was 135. The average for the first four months of 2025 was 1,300, almost 10 times higher.

An enormous part of that uncertainty relates to Trump’s tariffs, and the havoc they’re inflicting on entrepreneurs, investors and workers. But contradictions from the federal government in several key policy areas including government spending and borrowing, and energy policy are also creating uncertainty.

Unfortunately, Prime Minister Carney’s recent cabinet appointments and his subsequent media interviews failed to provide clarity.

Consider Tim Hodgson, the new Minister of Energy and Resources. He has a strong background in finance—CEO of Goldman Sachs Canada, chair of Ontario’s electric utility company Hydro One and investment board chair of the Ontario Teachers’ Pension Plan. The latter is important because he oversaw and approved investments in traditional energy companies such as Suncor and Canadian Natural Resources. Hodgson also has ties with the Alberta business community through his board appointments on several Calgary-based companies. His appointment has been interpreted by some that the Carney government will pursue policies to develop our oil and gas sector.

But the appointment of Julie Dabrusin as the Minister of the Environment and Climate Change signals the exact opposite. Dabrusin was the Parliamentary Secretary to the two previous Environment Ministers, Jonathan Wilkinson and Steven Guilbeault. Both opposed several pipeline developments, were instrumental in the introduction of a cap on emissions from the oil and gas sector, and other measures specifically designed to limit—if not actually decrease growth—in Canada’s traditional energy sector. A number of high-profile people in the energy patch, including Alberta Premier Danielle Smith, have already raised concerns about her appointment and what it means for energy development.

The appointments of Hodgson and Dabrusin continue the Carney government’s contradictory approach to policy, seemingly trying to be all things to all Canadians.

In a recent interview with CTV News, Prime Minister Carney simultaneously stated his support for new pipelines to deliver oil and gas to new markets but would not clarify if that meant revising or removing legislation that is broadly seen as a barrier to such developments. More specifically, during the campaign Carney said he would not eliminate Bill C-69, which covers how large infrastructure projects including pipelines are reviewed and approved. It’s widely agreed that Bill C-69 and its evaluation criteria make it almost impossible to build new pipelines in Canada.

Moreover, he failed to clarify whether he would eliminate the government’s current cap on emissions from the oil and gas sector, which is widely accepted as a cap on production. Indeed, according to the independent Parliamentary Budget Officer, the cap would result in less oil and gas production.

These glaring contradictions, which appear to be rooted in attempts to satisfy all Canadians and voting constituents, will need to be clarified at some point. There will come a time—whether it’s a budget (which apparently Canadians won’t see until next year), an application by a company to build a new pipeline, or perhaps just the continuing economic stagnation of the country—when the prime minister will be forced to make a clear choice. Until then, the cost of uncertainty will continue to impose real hardship on Canadians.

Jason Clemens

Executive Vice President, Fraser Institute

Tegan Hill

Director, Alberta Policy, Fraser Institute

This article supplied by Troy Media.

By Perry Kinkaide and Bill Jones

It’s time Canadians admitted Alberta’s oilpatch pays the bills. Other provinces just cash the cheques

When Canadians grumble about Alberta’s energy ambitions—labelling the province greedy for wanting to pump more oil—few stop to ask how much
money from each barrel ends up owing to them?

The irony is staggering. The very provinces rallying for green purity are cashing cheques underwritten not just by Alberta, but indirectly by the United States, which purchases more than 95 per cent of Alberta’s oil and gas, paid in U.S. dollars.

That revenue doesn’t stop at the Rockies. It flows straight to Ottawa, funding equalization programs (which redistribute federal tax revenue to help less wealthy provinces), national infrastructure and federal services that benefit the rest of the country.

This isn’t political rhetoric. It’s economic fact. Before the Leduc oil discovery in 1947, Alberta received about $3 to $5 billion (in today’s dollars) in federal support. Since then, it has paid back more than $500 billion. A $5-billion investment that returned 100 times more is the kind of deal that would send Bay Street into a frenzy.

Alberta’s oilpatch includes a massive industry of energy companies, refineries and pipeline networks that produce and export oil and gas, mostly to the U.S. Each barrel of oil generates roughly $14 in federal revenue through corporate taxes, personal income taxes, GST and additional fiscal capacity that boosts equalization transfers. Multiply that by more than 3.7 million barrels of oil (plus 8.6 billion cubic feet of natural gas) exported daily, and it’s clear Alberta underwrites much of the country’s prosperity.

Yet many Canadians seem unwilling to acknowledge where their prosperity comes from. There’s a growing disconnect between how goods are consumed and how they’re produced. People forget that gasoline comes from oil wells, electricity from power plants and phones from mining. Urban slogans like “Ban Fossil Fuels” rarely engage with the infrastructure and fiscal reality that keeps the country running.

Take Prince Edward Island, for example. From 1957 to 2023, it received $19.8 billion in equalization payments and contributed just $2 billion in taxes—a net gain of $17.8 billion.

Quebec tells a similar story. In 2023 alone, it received more than $14 billion in equalization payments, while continuing to run balanced or surplus budgets. From 1961 to 2023, Quebec received more than $200 billion in equalization payments, much of it funded by revenue from Alberta’s oil industry..

To be clear, not all federal transfers are equalization. Provinces also receive funding through national programs such as the Canada Health Transfer and
Canada Social Transfer. But equalization is the one most directly tied to the relative strength of provincial economies, and Alberta’s wealth has long driven that system.

By contrast to the have-not provinces, Alberta’s contribution has been extraordinary—an estimated 11.6 per cent annualized return on the federal
support it once received. Each Canadian receives about $485 per year from Alberta-generated oil revenues alone. Alberta is not the problem—it’s the
foundation of a prosperous Canada.

Still, when Alberta questions equalization or federal energy policy, critics cry foul. Premier Danielle Smith is not wrong to challenge a system in which the province footing the bill is the one most often criticized.

Yes, the oilpatch has flaws. Climate change is real. And many oil profits flow to shareholders abroad. But dismantling Alberta’s oil industry tomorrow wouldn’t stop climate change—it would only unravel the fiscal framework that sustains Canada.

The future must balance ambition with reality. Cleaner energy is essential, but not at the expense of biting the hand that feeds us.

And here’s the kicker: Donald Trump has long claimed the U.S. doesn’t need Canada’s products and therefore subsidizes Canada. Many Canadians scoffed.

But look at the flow of U.S. dollars into Alberta’s oilpatch—dollars that then bankroll Canada’s federal budget—and maybe, for once, he has a point.
It’s time to stop denying where Canada’s wealth comes from. Alberta isn’t the problem. It’s central to the country’s prosperity and unity.

Dr. Perry Kinkaide is a visionary leader and change agent. Since retiring in 2001, he has served as an advisor and director for various organizations and founded the Alberta Council of Technologies Society in 2005. Previously, he held leadership roles at KPMG Consulting and the Alberta Government. He holds a BA from Colgate University and an MSc and PhD in Brain Research from the University of Alberta.

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