As affordability crisis hits home, growing majority of Canadians deem oil, gas critical to economy

June 17th 2024
Despite a polarized energy debate and a torrent of criticism toward the oil and gas sector, Canadians’ opinion about the industry’s importance isn’t eroding like a sandcastle facing shifting tides.

In fact, it’s growing stronger.

During a keynote address to open the Global Energy Show in Calgary on Tuesday, well-known pollster Nik Nanos says the data is clear: more Canadians are supporting the industry, as “meat and potato” issues such as affordability, jobs and inflation hit home.

“Canadians are practical. They understand the importance of the sector and they definitely understand the importance of the sector today — but also the importance of the sector into the future,” Nanos told the crowd attending the annual conference at the BMO Centre.

“This is where we get into the era of what I’ll say is Canadians being cross-pressured. They have environmental aspirations. They know that we need action on climate change. But they’re looking to reconcile that with paying for the bills, the rising cost of living . . . an economic environment that leads to jobs and prosperity.”

Polling done by Nanos Research for the University of Ottawa’s Positive Energy research program earlier this year strikes to the heart of this matter.

Almost three-quarters of Canadians consider oil and gas to be important to the country’s economy today, up from 65 per cent in November 2020.

“The fact we have 74 per cent of Canadians agreeing on anything is actually quite a striking number,” he added.

Despite forecasts by the International Energy Agency (IEA) that global oil and natural gas demand will peak later this decade, 53 per cent of Canadians believe the oil and gas sector will be important to the future of the country’s economy, an increase from 41 per cent.

For Canada, this is an important discussion about the sector’s future at a critical time.

A new IEA report forecasts that Canadian oil production is expected to climb by more than 600,000 barrels per day (bpd) and top 6.5 million bpd by the end of this decade.

“Canadian production is set to continue its upward trajectory over the forecast period, buoyed by increases in bitumen output and expanded export capacity via the Trans Mountain Expansion,” it states, noting the pipeline will be full by 2028.

“The new pipeline will also open additional capacity to Asia and U.S. West Coast refineries.”

The study by the Paris-based agency also projects global oil demand will slow toward the end of the decade, approaching 106 million bpd — although up from 102 million bpd consumed last year — as the effects of electric vehicles and the clean energy transition increase.

As the world’s fourth-largest oil producer, Canada’s sector is also under pressure to decarbonize as concerns intensify around climate change and the use of fossil fuels.

Oil and gas is the largest emitting sector in the country, and it’s also Canada’s largest export. More than 208,000 Canadians worked directly in the oil and gas industry last month, reaching its highest point since late 2015.

The Liberal government has introduced an array of policies designed to lower emissions from the sector in recent years as it moves the country toward a net-zero emissions target by 2050.

It has established a national price on carbon, will require the sector to cut its methane emissions by at least 75 per cent and has introduced clean fuel regulations.

Ottawa also wants to introduce a cap on industry emissions, triggering staunch opposition from the Alberta government, which contends it is unconstitutional and will cap oil and gas production.

It’s also policy that doesn’t exist in other major oil-production nations, including the United States.

Industry leaders maintain that this layering on of policy creates confusion and uncertainty, making it more difficult to invest in emissions-reduction technology.

“We’ve seen a lot of stability in terms of the level of ambition of Canadians around taking climate action . . . (but) increasingly, we’re seeing Canadians putting on their hats as energy consumers,” said Monica Gattinger, a political scientist and chair of the Positive Energy research program.

“People are learning about the importance of oil and gas to their daily lives. They are seeing that it’s easier to say we’re going to transform our energy systems than to actually transform those systems.”

Nanos noted survey respondents handed out dismal grades when asked to consider the job Canada has done dealing with major energy projects and infrastructure.

They gave a tepid score of 5.5 out of 10 on the issue of the country approving new developments — such as pipelines, hydroelectric dams and LNG facilities — and 5.4 on ensuring we build energy infrastructure required for the future.

“I think less dogma and more practicality is probably what Canadians would like to hear,” Nanos said in an interview.

“For any government to bring Canadians on board, they need to be forthright and honest on what the real trade-offs are for these decisions, and not to just impose decisions.”

Credits to Calgary Herald, Chris Varcoe

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