Become an Energy Superpower, Canadian Companies Tell Parliament

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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--Presenting a wish list to the new Canadian government, representatives from the oil and gas sector said the time is ripe to make the nation an energy superpower.

U.S. President Donald Trump wasn't on the Canadian ballot, though his shadow hung over a political landscape that saw bilateral relations sour considerably when Trump on the campaign trail last year threatened steep tariffs on Canadian imports.

The row prompted Finance Minister Chrystia Freeland to resign amid concerns of U.S. "economic nationalism" and her boss, long-time Prime Minister Justin Trudeau, stepped aside earlier this year.

Mark Carney, a former governor of the U.K. and Canadian central banks, secured the premiership after voters cast ballots in favor of the Labor Party. The campaign to April 28 focused largely on trade, as Canada is a top exporter of lumber, oil and natural gas to the United States.

"Now is the time for members of Parliament to collaborate and make Canada an energy superpower," Greg Ebel, the president and chief executive officer at Enbridge Incorporated (NYSE:ENB) (Calgary, Alberta), said Wednesday.

Trump backed a 25% tariff, a tax on imports, for goods imported from Canada and Mexico, despite brokering a free-trade deal with both countries during a first term in office that ended in 2021. A 10% tariff applied to energy imported from Canada, though he later offered exemptions for oil and gas.

Tariffs on steel and aluminum, as well as automobiles, will complicate trade patterns in North America as supply chains are highly integrated. But sector representatives said it's energy that forms the backbone of the Canadian economy, contributing to around 10% of the nation's gross domestic product (GDP).

Recommendations to the Carney government include simplifying regulations, attracting more sector investments and working to increase domestic production.

"If executed, this urgent action plan will have a lasting impact on Canada's economic sovereignty, economy and global position," said Rich Kruger, the head of Alberta-based Suncor. "With a strategic vision for Canada's robust energy sector, we can bring back private sector investment into Canada for the benefit of generations to come."

Alberta is by far the leader in production, though Canada is largely isolated to North America in terms of energy trade. Over the seven-day period ending April 25, Canada delivered 3.7 million barrels per day to the U.S. economy, accounting for 60% of total imports.

Most of the U.S. refinery sector is tooled to run the heavier types of crude oil found in Canada rather than the light, sweet variety found in domestic shale basins.

Despite some trade concessions, Trump has continued with aggressive rhetoric on Canada, saying the nation may be better off as part of the U.S. federal union. Carney, who said earlier this week he hoped to meet personally with Trump, said Canada indeed could establish itself as a global leader in both conventional and clean energy.

"We are going to aggressively develop projects that are in the national interest in order to protect Canada's energy security, diversify our trade and enhance our long-term competitiveness--all while reducing emissions," he said earlier this week.

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