Danielle Smith wants to nationalize the oil industry? 5 takeaways from a wild week in Alberta politics
The provincial government was firing out announcements last week, from banning federal employees from oil sites to starting its own border patrol. What does it all mean?
Alberta Premier Danielle Smith has had a busy week carving out elements of a sovereign Alberta in order to push back against the federal government's oil and gas emissions cap.
There has been a deluge in Alberta lately, each week bringing an endless stream of announcements or re-announcements. Some are small, some are let’s-see-if-we-can-break-Canada significant. Think: ignoring federal laws and establishing its own border patrol.
Let’s just say the past week has been one for the books.
It’s hard to keep track of everything and the context behind it, even for those who are, ahem, paid to keep track of what’s tied to energy and the environment (let’s face it, that’s everything).
Here is a roundup of Danielle Smith’s significant moves related to energy and the environment recently — and a little analysis of what is, or could be, behind them.
1. Alberta Oil and Gas Inc.?
Hands down the most significant announcement this week is Danielle Smith’s plan to (sort of) nationalize aspects of the province’s oil and gas industry in response to the federal government’s proposed emissions cap.
Smith wants to invoke her creatively titled Sovereignty Within a United Canada Act to sell oil and gas directly for companies through a royalty-in-kind program. Basically, “give us the oil and gas instead of paying us royalties and we’ll sell it for you” — our words, not hers.
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We’re covering energy on the Prairies
The province also vows to work with other jurisdictions to build more pipelines to the U.S., but the details are unclear.
The moves to directly market and sell oil, as well as investing or intervening to build pipelines (not to mention the little nuggets you’ll read below about controlling data and access to oil and gas sites) are a not-insignificant departure from the free hand of the market.
But wait, there’s more.
2. Danielle Smith wants to ban federal employees from Alberta oil and gas sites
The province argues the emissions cap on the oil and gas industry is actually a cap on production and will hurt the economy. The federal government, well, disagrees.
Smith’s government said it would retaliate against the federal government if it brings in an emissions cap by launching a constitutional challenge. Smith also suggested Alberta would somehow block access to private oil and gas facilities for any federal employee or contractor — basically anyone who’s not working for the company, or who hasn’t been “specifically licensed to enter by the Government of Alberta.”
Alberta Premier Danielle Smith says the province would prohibit federal employees and contractors from accessing oil and gas sites if the draft emissions cap is instituted. It’s unclear how that would work. Photo: Amber Bracken / The Narwhal
It is extremely unclear how this would work.
The Alberta government also wants to declare “all information that is directly or indirectly related to greenhouse gas,” and collected by oil and gas companies operating in Alberta, to be the property of the province. Essentially, the province wants to take ownership of private data from companies that operate across the country (and beyond) and which are legally required to provide that data to the federal government.
3. Alberta is getting its own border patrol?
U.S. president-elect Donald Trump said he’d find some time between mass incarcerations and deportations on Day One of his administration to impose 25 per cent tariffs on Canada and Mexico. Maybe he’s just bluffing, but the implications for Alberta could be big.
Oil and gas, he said, would not be spared.
That’s bad news for the province, which sells almost all of its fossil fuels to the U.S. Crude oil exports to the U.S. alone were valued at approximately $108 billion in 2023 (that’s just Alberta and just crude).
In response to the threat of tariffs, Danielle Smith said Alberta could introduce its own border patrols, but the details remain murky as the border is federal jurisdiction. Photo: Gavin John / The Narwhal
“I communicated this very clearly to the prime minister, and further indicated that Alberta will be acting urgently and decisively to patrol our own shared border with Montana, with more details to be announced soon in that regard,” she said in a news release.
4. Carbon taxes for green technol … sorry, what’s that? Did you say drilling?
The other carbon tax, the one imposed on industry and run by the province, is supposed to funnel money to green technology to help industry innovate and reduce emissions.
The money, which will be used to create a test site for companies to experiment with new technologies, will also help at least one geothermal company. The province has a lot of geothermal resources and that also involves drilling deep into the ground.
But the geothermal angle could be seen as justification for using green tech funds for fossil fuels.
“The Alberta drilling accelerator means big things for oil and gas exploration in our province, but also for industries that will be vital for achieving our goal of carbon neutrality by 2050,” Smith said in the announcement. The province is still very short on details or goals for its plan to achieve net-zero by 2050.
Alberta has a long history of drilling for oil and gas, and a nascent geothermal industry. The provincial government decided this week to use money collected through the industrial carbon price, intended for emissions reduction technology, for a drilling test site. Photo: Amber Bracken / The Narwhal
Oil companies Tourmaline Oil and Halliburton have expressed interest in being anchor tenants at the new test site, along with geothermal outfit Eavor, according to the province.
5. Danielle Smith wants impact assessment act assessed in court — again
Finally, the province said it’s taking the federal government to court again over the Impact Assessment Act — which allows Canada to evaluate and deny projects with significant environmental footprints.
The federal government apparently ignored a four-week deadline unilaterally established by the province to change the act, so it’s back to court.
Like a kid in a candy store
When those boxes of heavily redacted documents start to pile in, reporters at The Narwhal waste no time in looking for kernels of news that matter the most. Just ask our Prairies reporter Drew Anderson, who gleefully scanned through freedom of information files like a kid in a candy store, leading to pretty damning revelations in Alberta. Long story short: the government wasn’t being forthright when it claimed its pause on new renewable energy projects wasn’t political. Just like that, our small team was again leading the charge on a pretty big story.
In an oil-rich province like Alberta, that kind of reporting is crucial. But look at our investigative work on TC Energy’s Coastal GasLink pipeline to the west, or our Greenbelt reporting out in Ontario. They all highlight one thing: those with power over our shared natural world don’t want you to know how — or why — they call the shots. And we try to disrupt that.
Our journalism is powered by people just like you. We never take corporate ad dollars, or put this public-interest information behind a paywall. Will you join the pod of Narwhals that make a difference by helping us uncover some of the most important stories of our time?
When those boxes of heavily redacted documents start to pile in, reporters at The Narwhal waste no time in looking for kernels of news that matter the most. Just ask our Prairies reporter Drew Anderson, who gleefully scanned through freedom of information files like a kid in a candy store, leading to pretty damning revelations in Alberta. Long story short: the government wasn’t being forthright when it claimed its pause on new renewable energy projects wasn’t political. Just like that, our small team was again leading the charge on a pretty big story.
In an oil-rich province like Alberta, that kind of reporting is crucial. But look at our investigative work on TC Energy’s Coastal GasLink pipeline to the west, or our Greenbelt reporting out in Ontario. They all highlight one thing: those with power over our shared natural world don’t want you to know how — or why — they call the shots. And we try to disrupt that.
Our journalism is powered by people just like you. We never take corporate ad dollars, or put this public-interest information behind a paywall. Will you join the pod of Narwhals that make a difference by helping us uncover some of the most important stories of our time?
Your access to our journalism is free — always. Sign up for our weekly newsletter for investigative reporting on the natural world in Canada you won’t find anywhere else.
Your access to our journalism is free — always. Sign up for our weekly newsletter for investigative reporting on the natural world in Canada you won’t find anywhere else.
