The world needs Canadian oil and gas — it just doesn't know it yet
Canadian energy still lacks a global presence, held back by infrastructure challenges and complacency
This column is an opinion by Deborah Yedlin, a long-time business commentator and president and CEO of the Calgary Chamber of Commerce. For more information about CBC's Opinion section, please see the FAQ.
For many attending this year's CERAWeek energy conference in Houston, energy security has been something studied in the Pulitzer Prize-winning book, The Prize, and not a lived experience.
But the events in Ukraine shot energy security to the top of the CERAWeek agenda — with the book's author, S&P Global's vice-chairman Daniel Yergin, opening the conference by declaring the world has not seen anything like this since the 1970s.
The combination of a lack of investment, rising demand and now a major military conflict have lifted energy security off the pages of The Prize and landed them squarely into a stark reality.
Over the last three days, there hasn't been a panel in which energy security wasn't discussed. And while some might think this crisis would relegate the climate change and decarbonization agenda to the back seat, that's not been the case.
Quite the opposite, in fact.
When John Kerry, U.S. Special Presidential Envoy for Climate, began the conference in conversation with Yergin, he addressed the issues the world is facing, pointing to the need to continue efforts to decrease emissions while meeting global energy demand. And this tone continued throughout.
But Canada has been largely absent from the conversation, save for a Canadian presence on several panels — including one with Alberta Energy Minister Sonya Savage and the chief executives of Suncor and Cenovus.
And yet, given the vivid challenges facing the world's energy supply, it should be clear Canada's oil and natural gas resources are critical to the world's energy security, not to mention filling the gap created by President Joe Biden's decision to ban Russian barrels from the United States.
The world doesn't see it that way.
If it did, Canada would be part of the conversation. Remember, CERAWeek brings the energy world together and remains unprecedented in terms of reach and calibre. It should happen — but it hasn't.
So why is that?
One answer could be that Canada, despite having the third-largest reserves on the planet, doesn't have a global energy presence. Our only customer remains the U.S. We have not been able to build a presence beyond the continental borders, due in part to challenges building infrastructure and complacency. And we have let others tell a story that our energy doesn't belong, it's not good enough. Too expensive. Too far. Too much carbon.
Now is the time to change that channel. Because now is the time the world needs Canada's energy.
Canada's energy sector, with current production of 4.7 million barrels per day of oil and 15.7 billion cubic feet per day of natural gas, is poised to play an important role in meeting the world's energy needs.
It's bad enough that President Biden didn't mention Canada as a supplier to replace the Russian barrels that were banned this week, but fuel was added to the proverbial fire when U.S. Energy Secretary Jennifer Granholm — who was born in Canada — also didn't say anything about Canada being able to bridge the supply gap when she spoke to the 6,000 CERAWeek delegates on Wednesday.
Instead, Granholm urged the U.S. producers in the packed room to boost production so that U.S. gasoline prices can come down.
And tempting though it is, pointing to the cancellation of the Keystone XL project isn't helpful. Nor will it change anything. TC Energy has said it is not reviving the project. Keystone has become a symbol of what could have been, but it can't hold us back from what we can do.
It is imperative we continue to make progress decarbonizing our barrels.
The Pathways to Net Zero Initiative involving six oilsands producers and representing 95 per cent of production is the first of its kind in any industry and should be held up as an example of what's possible when competitors decide collaboration is how this Gordian knot can be untangled. First on the list for Pathways is building a Carbon Capture and Storage network, linking 20 oilsands facilities and storing the carbon underground. It will be one of the biggest on the planet.
Let's tell that story — from coast to coast and internationally.
Additionally, the processes and techniques uncovered, discovered and applied will support the decarbonization of the global industrial complex. The results from Pathways will speak for themselves and that narrative of "not good enough" will disappear.
And, as the world seeks to decarbonize, there should be no question around the potential of Canada to grow its LNG presence. We must resurrect projects — on the east and west coasts. It is a moral imperative: from decreasing emissions by supporting countries to decrease dependence on coal, to sending LNG to Europe and ensuring a permanent separation from dependence on Russian natural gas.
More than a decade ago, Canada was in the pole position on the LNG front, as the U.S. was deciding whether it wanted to go ahead and build export capacity, because there were still concerns over adequacy of supply.
The so-called "shale gale" changed that and, in 2016 the U.S. started exporting LNG. This year the U.S. is poised to be the world's largest exporter of LNG, with its LNG exports to Europe in January exceeding the natural gas delivered by pipe from Russia. Canada doesn't export any.
It's no secret that calls were being made in recent weeks to energy executives and bankers in Calgary, from Ottawa, asking what it would take to revive LNG projects that have been shelved. An expedited and certain regulatory process, with clear timelines, would be a good place to start. And it's not too late.
As Charif Souki, who co-founded the LNG exporter Cheniere Energy, said to Yergin on Wednesday: "The best time to have built an LNG terminal was five years ago. And the second-best time is today."
In addition to energy security, the Russian conflict laid bare something else.
The world is watching as companies from every sector have made the decision to walk away from their Russian operations. This, after billions of dollars of investment and decades of operations. It is unprecedented and sends a very strong signal that when it comes to ESG performance, all the letters matter. It's not just the E for Environment. It's about the Social and the Governance too.
Canada scores high in each of those letters. And that matters today, more than ever.
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