Canadian Energy Sector Issues Carney Government a Wish List

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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--Expand oil and gas opportunities at home and seize the moment to help establish Canada as an energy powerhouse, sector representatives told the newly-minted Cabinet of Prime Minister Mark Carney.

Carney, a Liberal who secured his position as prime minister through snap elections last month, established his new government on Tuesday with the announcement of new Cabinet officials that he said would help build a new Canadian economy that can withstand future economic shocks.

"They will work in collaboration with provinces, territories, and Indigenous Peoples to advance the nation-building investments that will support the government's core mission of building one strong, united economy -- the strongest economy in the G7," Carney's office said.

Carney ascended to prime minister after long-tenured Justin Trudeau stepped aside during internal political bickering over the response to tariff threats from U.S. President Donald Trump. Sparing energy from the import tax, Trump has imposed new tariffs on Canadian goods, from steel to lumber.

The United States depends heavily on Canadian oil and natural gas. It's a net importer of natural gas and relies on Canadian oil for 60%, or around 4 million barrels per day, of its total imports.

Before the government announcement, provincial and sector leaders were already calling on Carney to do more to support the oil and gas industry. On Tuesday, Lisa Baiton, the president and chief executive officer of the Canadian Association of Petroleum Producers, said a new prime minister was a chance for an economic reset.

"With strategic policies and necessary infrastructure, the energy sector is ready to drive new investments, create and support high-paying jobs, and ensure a stable supply of affordable energy for Canadians and our global trading partners," she said.

The upstream oil and gas sector in Canada accounts for about 3% of the nation's total gross domestic product. Exports were valued at around $88 billion in 2023, the last full year for which the Canadian government published data.

Because of integrated North American supply chains, the U.S. economy is heavily dependent on Canadian energy, as well as other good such as timber. Trump's fluid trade policies, however, have created uncertainty among investors, prompting Canada to look for new arteries outside North America.

The Canadian Association of Energy Contractors presented Carney's government with a wish list that included the immediate expansion of oil and gas infrastructure and the elimination of an emissions cap on the industry.

"Canadians spoke clearly: the debate is no longer whether to develop our natural resources, but how swiftly and boldly we can advance," the group's President and Chief Executive Officer Mark Scholz said. "Now, the question is whether this new government is prepared to act with the urgency and ambition this moment demands."

Carney himself has suggested Canada could do more to capitalize on its domestic resources, while standing up to Trump during a recent visit to Washington D.C.

Despite trade tensions, U.S. federal data show Canadian oil exports over the seven-day period ending May 2 were 4.8% higher than the same period last year.

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