Written By Patrick Maguire KC and Martin Ignasiak KC
Day One of the 24th World Petroleum Congress kicked off in Calgary today as 5,000 delegates from more than 100 countries have come together to help define realistic, workable paths to a net zero future.
Bennett Jones is the Official Legal Sponsor of WPC 2023 and the firm is hosting Meet the Expert and Knowledge Connect sessions with our energy partners throughout the week. These will help to share the Canadian perspective on where opportunities lie in the energy transition. Today, Pat Maguire and Martin Ignasiak spoke about the role of Canada as a global energy supplier, how to make Canada more competitive and why more and more people are realizing that the energy question is not a simple one.
Quality of Resources
Canada has some of the highest quality oil and gas resources in the world. We have the third largest reserves of oil and we are the fourth largest oil producer and number six in natural gas. All are produced cost effectively and ethically. Canada holds an enviable place as worldwide oil demand hit record levels this year and continues to grow. S&P Global says that continued European LNG demand and a recovery in demand from Asia are likely to drive prices for the next couple of years.
Project Timelines and the Need for More Predictability
Canada is well-respected as a safe, sovereign jurisdiction to do business in and one that respects the rule of law. The biggest challenge continues to be the length of time it can take to get energy projects approved. There has been some progress on this as federal and provincial governments continue to look for greater regulatory efficiency to ensure that the Canadian energy industry can be competitive internationally. Companies do not have a problem with emissions and environmental standards, but there are legitimate concerns regarding the time required to get projects approved and built.
Energy companies in Canada are making a lot of progress in engaging with Indigenous communities and involving them in the economics of projects. Five years ago, working with Indigenous communities was seen as a way to reduce risk. Now, company engagement with communities on resource development includes meaningful equity participation, in addition to other benefits such as employment commitments, a role in governance and opportunities for Indigenous business to provide goods and services as part of project development and operation. This is part of the broader reconciliation effort in Canada and the industry has a unique role in how it can contribute.
Canada's federal and provincial governments need to work together with Indigenous communities on proactive land use planning. Alberta is leading the way with its Land Stewardship Act. Land planning that is recognized by all levels of government in Canada will provide developers with more certainty.
Companies are waiting for the Supreme Court of Canada's decision on whether or not the federal Impact Assessment Act impedes on provincial jurisdiction. What is most important here is for the federal and provincial governments to put forward policies that can make the energy industry as competitive as possible.
The Energy Question is Not a Simple One
As the pace picks up on the road to net zero, more and more people are realizing that the energy question is not a simple one. There is no magic bullet and there is no technology that will be a singular solution. The transition is going to require a mix of technologies and products, governmental support and industry initiatives. Canada needs to be careful that governments do not choose between technologies, but instead provides an ecosystem in which many evolving technologies can be assessed and developed, with the most impactful and cost effective options having the ability to grow in the market.
More WPC 2023 Recaps
Bennett Jones provided daily blogs with briefing notes of crucial developments from WPC 2023, the Olympics of the petroleum industry. Read the other insights here: