Canada’s vast landscape, which boasts 20 per cent of the world’s fresh water, a quarter of global wetlands and 28 per cent of its boreal forests, is critical to its economy. Natural resource industries — forests, farms, fisheries, mining and oil and gas — together make up approximately seven per cent of Canada’s gross domestic product. 

Tension exists between expanding these industrialized sectors and protecting the ecosystems on which they depend. In Manitoba, some worry protecting the Seal River Watershed, which spans more than 50,000 square kilometres in the province’s north, will hinder opportunities in mineral resources and hydro; to the east, critical mineral mining ambitions in Ontario’s Ring of Fire clash with the protection of the Hudson and James Bay Lowlands, the second-largest carbon sink on earth; and in B.C., Coastal First Nations have protested that lifting the large tanker ban through their waters will endanger the protected Great Bear Rainforest.

These tensions make it easy to frame nature as the antithesis of economic activity, if it’s always put in opposition to projects that are described as growing Canada’s wealth, sovereignty and security. But a growing chorus of economic and policy leaders, alongside conservation groups, are making the case for nature to be seen as a critical financial asset — not a barrier, but another opportunity for economic growth. 

The federal government’s vision for conservation, laid out in its 2026 nature strategy, is of a nation that “protects, restores, and values nature as a foundation of our economy, sovereignty, and well-being.” 

One of the pillars to achieving that vision is “valuing nature and mobilizing capital,” according to the strategy. It estimated the value of “ecosystem services” — the direct and indirect contributions of nature to well-being and quality of life — to be $3.6 trillion, or “more than double our 2018 GDP.” In other words, the government is looking to spur more private sector investment in conservation by showing businesses how valuable nature is to their bottom lines.

The numbers show conservation is comparable with many of Canada’s major industries. While it may not produce the same scale of economic value as major resource extraction sectors like oil and gas — which does not approach the value of sectors like health care or education — it is a significant contributor to Canada’s economy. And the return on investment is high: a recent analysis by the Canadian Parks and Wilderness Society (CPAWS) found every dollar spent on protected areas generated more than $3.50 in visitor spending, helping fuel local economies and generate government revenues. 

Like the oil and gas sector, Canada can choose to invest in the potential of conservation and champion it as a cornerstone of our country’s economic future. And as Canadians grapple with the increasingly severe impacts of the climate crisis, the role of intact ecosystems becomes even more valuable. 

These nine charts capture some of the value of Canada’s natural environments, and the economic potential of conservation.

Economic contributions from protected areas — by province

Gross domestic product (GDP) contributions of selected Canadian industries

How are the industries defined?+

Statistics Canada tracks economic activity indicators for a wide range of sectors using the North American Industry Classification System (NAICS), which assigns a code to specific activities and sectors. Industries and government agencies tally these statistics in different ways to determine overall sector impacts. 

This analysis uses Statistics Canada’s data, and defines each industry as follows:

Agriculture: Crop and animal production (farming), related support activities and food manufacturing, including mills, bakeries, meat and dairy production.

Fisheries: Aquaculture, fishing, hunting and trapping and seafood product preparation.

Forestry: Forestry and logging, related support activities, wood and paper product manufacturing. 

Mining: Mineral mining (ore, non-metals, potash) and quarrying activities, including related support. Also includes mineral product manufacturing and metal manufacturing. 

Oil and gas: Oil and gas extraction and related support activities, petroleum and coal product manufacturing, natural gas distribution and pipelines.

Transportation: Air, rail, water, truck and transit and ground transportation (including public transit and taxis). 

Utilities: Electric power generation, transmission and distribution and water and sewage systems.

Jobs and compensation

More than 150,000 people work in protected and conserved areas — not far behind the oil and gas and forestry sectors. As the Canadian Parks and Wilderness Society points out, many of these jobs are in Indigenous, rural and remote communities, where unemployment rates are high compared to urban areas. In parts of Canada where other economic opportunities are scarce, protected and conserved areas offer the opportunity to create long-term stable employment. 

Conservation provides value, but how are conservation workers valued? Compensation for the approximately 150,000 Canadians who work in protected areas is low, compared to other sectors; on average, an oil and gas worker makes nearly four times as much annually. 

Tax revenues and subsidies

Governments collected more than $1.4 billion in tax revenues from parks and protected areas in 2024, most of which stemmed from visitor spending, according to the Canadian Parks and Wilderness Society’s analysis. That’s comparable to government tax revenues from the forestry industry, at $1.2 billion. Major resource industries like forestry and oil and gas also create government revenue through royalties and other fees. 

But for many of these industries, government revenues can be offset by tax breaks, grants and other subsidies.

Governments invested $2.3 billion in parks and protected spaces in 2024, generating $0.62 in revenue for every dollar invested. By comparison, the Organisation for Economic Co-operation and Development (OECD) estimates the federal government spent $3.17 billion USD (or $4.34 billion CAD) on fossil fuel subsidies — almost $1 billion USD more than the United States spent on subsidies, despite their industry’s far greater output. That number is likely an underestimate, as a lack of clear data and complex incentive structures make it difficult to track how much governments give out to industry. 

Environmental Defence, which releases an annual report tracking Canadian fossil fuel subsidies, estimates the government doled out more than $30 billion in subsidies and financing to fossil fuel companies in 2024. Most of that funding came in the form of a $20-billion loan for the Trans Mountain Expansion project. 

Carbon storage

The Canadian Parks and Wilderness Society estimated the carbon stocks stored in Canada’s existing protected areas by comparing protected area boundaries to data showing the carbon concentration in soil, vegetated areas and seabed sediments. 

It found a total 51.4 gigatons of carbon stored in the country’s protected forests, peatlands, wetlands, soil and seabeds. 

If this carbon was all emitted as carbon dioxide, the Canadian Parks and Wilderness Society estimates, it would equate to 188.4 gigatons of emissions. 

By protecting these regions from industrial disturbances like mining, logging or draining, that carbon stays in the ground. If released, that carbon comes at a cost. 

Canada’s industrial carbon price, which charges businesses for emissions that exceed a predetermined limit, is $110 per tonne as of 2026. A carbon credit — doled out for activities that remove or avoid carbon emissions — is worth the same.

At that price, the carbon stored in Canada’s protected areas is worth $20.7 trillion. 

That’s about 10 times the value of Canada’s global mining assets ($352.6 billion), global energy assets ($827 billion) and domestic farm sector assets ($992.4 billion) combined.

Annual carbon capture

Protected and conserved areas remove greenhouse gases from the atmosphere, a process known as “carbon capture.” Manitoba’s Riding Mountain National Park, for example, removed an average of 108,328 tonnes of carbon dioxide per year from the atmosphere between 1990 and 2020. This is significantly less than Shell’s Quest carbon capture and storage project, but it’s also just one of hundreds of parks and protected areas across Canada.

Most parks, like the ones included in this chart, are sequestering carbon each year. However, when parks or protected areas are hit by wildfires, they can become carbon emitters.

– With files from Michelle Cyca

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Enbridge Gas will face Waterloo Region in a hearing before the Ontario Energy Board to renew an agreement that would allow the company to continue building pipelines on public land without charge for another 20 years.

Such agreements “are in the public interest” and “work for communities, customers and the province as a whole,” an Enbridge Gas spokesperson has told The Narwhal.

The hearing comes after Waterloo Region resisted renewing its contract with Enbridge Gas, known as a model franchise agreement, in November. Doing so would have locked the municipality into offering free land to the company that sells natural gas, which is largely made up of methane, a potent greenhouse gas that traps heat in the atmosphere. These agreements also absolve Enbridge Gas of responsibility for removing outdated pipelines, leaving the costs and labour of doing so with cash-strapped municipalities.

Waterloo Region’s refusal to re-sign follows a similar decision by Guelph in late 2024, which Enbridge Gas will contest in a hearing in 2026.

“We respect the [Ontario Energy Board’s] jurisdiction and will not comment on the details of the Waterloo Region application,” Enbridge Gas spokesperson Chloe Mills told The Narwhal in an emailed response on Dec. 24. 

As a regulated utility, the company is required to participate, Mills added. “This is a long-standing legislated process that ensures transparency and fairness — it’s not about one party taking another to the [board], but about following statutory requirements,” she said.

Ontario law requires municipalities to enter into agreements with natural gas providers, allowing them to build pipelines under roadways and surrounding lands without charge. Enbridge Gas has these agreements with more than 340 municipalities, the details of which are negotiated through the energy board, a non-partisan regulator mandated to uphold provincial law.

The Ontario Energy Board has announced a full review of these agreements in spring 2026, the first since 1999. That will play out alongside the company’s push for Guelph and now Waterloo Region to renew. The request to weigh in on the region’s refusal was laid out by the board in a letter issued to the company on Dec. 19, and confirmed to The Narwhal by a board spokesperson.

“The Ontario Energy Board confirms that Enbridge [Gas] has filed an application for the renewal of a municipal franchise agreement with the Regional Municipality of Waterloo,” Tom Miller, board spokesperson, said. 

A spokesperson for Waterloo Region said it is not able to comment on the hearing as “the matter is ongoing.”   

Elected officials from Waterloo Region and Guelph, along with energy lawyers and experts, have previously told The Narwhal these agreements are misaligned with goals to reduce emissions quickly, as scientists urge a shift away from gas and other fossil fuels to mitigate the worst impacts of global warming.

We’re suing the RCMP to fight for press freedom

In November 2021, photojournalist Amber Bracken was arrested by the RCMP while on assignment for The Narwhal. So we launched a lawsuit to take a stand for press freedom. Now, we’re in the middle of our trial.

City councils in both Ottawa and Toronto have shared similar concerns with the Ontario government. Representatives from the municipalities have said the agreements amount to a subsidy for the fossil fuel company. 

Enbridge Gas says these claims are “simply not true.”

The Narwhal sent the company questions about these agreements four business days before publishing a story Dec. 17, on Waterloo Region’s decision not to renew. After that story was published, the company responded to the questions in an email, in which Mills told The Narwhal the Ontario Energy Board has determined the terms of the agreements “exist to defend the interests of our customers.” 

“In the Region of Waterloo alone, we serve over 105,000 customers — including homes, businesses, schools and hospitals that rely on natural gas every day,” Mills said. “The [agreements] ensure that communities continue to have ready, affordable access to the energy they rely on every day.”

Enbridge Gas says fees for use of roadways ‘would simply be passed on to customers’

In the Dec.17 statement from Enbridge Gas, Mills said the franchise agreements “provide a uniform standard that protects both customers and municipalities with clear, consistent rules for building, maintaining and upgrading gas infrastructure.”

“This keeps projects safe and costs predictable,” she continued. “This standardized approach means everyone plays by the same rules and prevents one-off local deals that could drive up bills for families and businesses.”

But in recent years, many Ontario municipalities have been implementing localized plans to reach net-zero emissions by 2050. Unique initiatives range from green building standards that prioritize electric heating over natural gas connections in some cities and towns to building multi-use roadways that include bike lanes and walking trails in others.

Cities are also looking to install more fibre optic cables to ensure access to fast internet, upgrade stormwater systems to handle flooding and more sewage intake, bury transmission lines to protect them from extreme weather and build transit.

In light of all this, Waterloo Region and Guelph argue it no longer makes sense that Enbridge Gas — a for-profit company — gets to use much-needed underground space for free. Meanwhile, in provinces like British Columbia and Alberta, where pipelines are built in greater numbers, municipalities can charge gas companies that want to build pipelines on their land.

Mills said these provinces have different laws and ownership rules for public utilities. If Ontario changed its laws to allow the same, Mills said, “Additional costs would simply be passed on to customers. Our system helps keep energy affordable and allows for customer choice.” Enbridge Gas can apply to the Ontario Energy Board for approval to increase rates, as it recently did.

Mills also noted gas utilities do pay municipalities in the form of property taxes. And while provincial regulations do not allow municipalities to charge utilities for the use of roadways, they are able to charge gas utilities — as well as electricity and telecoms — for the administrative costs of issuing permits, she added.

She said any municipality that wants to change its agreement “must show the [Ontario Energy Board] there’s a good reason for it that is unique to the municipality and the [board] will decide whether a change is warranted.” 

Mills added that the board “reviews and approves every agreement to make sure it’s fair and in the public interest.” 

Miller, with the Ontario Energy Board, declined to comment on the individual cases, or the broader review of the agreements. He confirmed the review will happen in 2026 and said it would be “informed by recent applications” and “examine the need to update certain provisions” of the model franchise agreements.

The upcoming Ontario Energy Board hearings between Enbridge Gas and the municipalities come in the wake of the board’s 2023 decision, when it ordered the company to stop passing down the cost of new gas hookups to homeowners on their bills. In early 2024, the Ford government made the unprecedented decision to overrule the regulator’s decision. 

“While it is always the prerogative of governments to make policy and seek to pass laws, our approach has not changed,” Miller told The Narwhal in an email. “The independence and transparency of decisions is fundamental to a healthy regulatory model, allowing for impartial, evidence-based decision-making that fosters confidence in the sector by regulated entities, investors and the public that we serve.”

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A pivotal shift in Ontario’s relationship with natural gas seems to be underway, with Waterloo Region becoming the second municipality to resist renewing a contract that allows Enbridge Gas to build pipelines on public land for free.

Guelph took a similar stance a year ago, ultimately deciding not to sign the contract. It would have locked the city in for another two decades of offering free land to the company that sells natural gas, which is largely made up of methane, a potent greenhouse gas that traps heat in the atmosphere.

As scientists urge a shift away from gas and other fossil fuels, agreements like this continue to absolve Enbridge Gas of responsibility for removing outdated pipelines, leaving the costs and labour of doing so with cash-strapped municipalities. 

Since 2000, Waterloo Region, Guelph and around 340 other Ontario municipalities have made such agreements with Enbridge Gas — a unique arrangement in Canada. In provinces like British Columbia and Alberta, where pipelines are built in greater numbers, municipalities can charge gas companies that want to build pipelines on their lands. 

So when councillors at the Waterloo Regional Municipality, which includes the cities of Waterloo, Kitchener and Cambridge, learned their agreement with Enbridge Gas was set to expire in May 2026, they hit pause. In a Nov. 19 meeting, councillors instructed staff to make some big changes to the agreement.

“We have a for-profit enterprise that uses public property and generates a profit from that,” Waterloo Regional Councillor Matt Rodrigues told The Narwhal. “That’s concerning.”

Enbridge Gas did not respond to The Narwhal’s questions by publication time.

Both Waterloo Region and Guelph have argued they are not entirely opposed to Enbridge Gas building pipelines, but that they want to be paid for any use of their lands as the pressure on local coffers increases.

Both municipalities have also argued for the choice to stop subsidizing natural gas infrastructure if needed, to make way for other, cleaner forms of energy that weren’t as abundant or cost-effective when these agreements were last signed. Locking into a new 20-year agreement would limit municipalities’ ability to respond to climate change and reach net-zero emissions by 2050, they say. 

“It just made sense not to sign on the dotted line just because it was slid across the table,” Cam Guthrie, mayor of Guelph, told The Narwhal. “In today’s world, there’s choice. Twenty years ago, there weren’t heat pumps, but now today, there are. So our residents can choose what kind of infrastructure they want their homes and businesses to be connected to.”“We live in a world with technology and changing innovation, which, to me, makes it more valid that we don’t have to lock into such contracts for such a long time.”

But provincial law requires municipalities to sign these agreements. So Enbridge Gas is taking Guelph to the Ontario Energy Board, a non-partisan regulator, to compel the city to sign that dotted line. Meanwhile, city councils in both Ottawa and Toronto have also asked the province to change their agreements, and the board has announced a full review of them in 2026. It will be the first review since 1999, and is intended to “examine the need to update certain provisions” of the agreement, a board spokesperson told The Narwhal. 

As Guelph and Waterloo Region, with a combined population of almost 900,000 people, challenge an energy giant, the next 20 years for municipalities across Ontario hinge on what happens next. 

Here’s everything you need to know about the agreements and the brewing local fight to change them.

So how does Enbridge Gas get free access to build its pipelines, exactly?

The technical term for these contracts are model franchise agreements. Broadly, they serve as agreements between Ontario municipalities and utilities that set the terms under which certain industries can build under public roadways and surrounding lands. These include natural gas, electricity and telecommunications, all three of which are identified as a public good and therefore granted free access to public land. 

At the time these agreements were formed, Enbridge Gas was a Crown corporation, known then as Consumers’ Gas Company. It became a for-profit company in the late 1990s and gained a near-monopoly on natural gas distribution in Ontario. The latest version of the agreement was written in 2000 and, even without Guelph and Waterloo Region, Enbridge Gas still holds this contract with roughly 340 of Ontario’s 444 municipalities, according to its public statements, locking each into a 20-year contract allowing the company to build pipelines on public land without any charge. 

That means Enbridge Gas can build a pipeline along municipal roadways, technically known as a right of way, without paying any rent or land-based fee.

The Narwhal spoke to ten people, including local elected officials, energy lawyers and environmental advocates, all of whom described these agreements as a subsidy for a fossil fuel giant at a time when many cities are looking to reduce their emissions.

When these agreements were made, “gas was considered a transition fuel from coal, and it was still considered a public good,” Kent Elson, an energy lawyer, told The Narwhal. “We’re now at a stage where it’s very clearly inconsistent with a net-zero future. So we’re subsidizing something that’s not a public good anymore.” 

Is your municipality’s model franchise agreement with Enbridge Gas up for renewal? Let us know.+

If you’re not sure, ask your elected officials or contact the municipality. And email us: editor@thenarwhal.ca

These agreements also don’t mandate gas utilities to pay to remove old or abandoned pipelines. (For comparison, telecommunication utilities are required to cover the cost of removing old equipment under federal law.) And if the pipeline needs to be moved to widen a sewer system, for example, municipalities have to pay 35 per cent of the cost — a huge expense. 

Until now, municipalities have “signed these agreements like zombies because we have been led to believe we must,” Leanne Caron, a Guelph city councillor, told The Narwhal. “But it’s a kind of historical hangover from a past era where the utility was actually public, and it made no sense to charge a public utility for the public right of way.” 

Why do Guelph and Waterloo Region want to change their agreements with Enbridge Gas? 

For three reasons. 

First: money. Both municipalities want the ability to negotiate fees for using their land. This could generate much-needed revenue for local emissions-reduction and energy conservation efforts. Both also want Enbridge Gas to be 100 per cent responsible for the costs of removing or replacing pipelines, a real concern as cities move away from gas and the pipelines that deliver it. 

Second: climate change. Both municipalities are concerned these agreements create an unfair playing field for lower-emissions forms of energy, such as heat pumps. “This is about fairness and challenging the status quo,” Caron said. 

These model franchise agreements between Ontario municipalities and Enbridge Gas were written before a climate emergency was declared. They were written before broad recommendations to shift away from fossil fuels to ward off the impacts of global warming, which include an increasing number of severe storms, floods and wildfires — all of which Ontario and Canada have faced in recent years.

Lastly: independence. Both municipalities want more control over their lands, their energy supply and the agreements that manage both.

Since the agreements were first written, Ontario municipalities have faced massive growth, doubling in population since 1971. That has resulted in increased demand for local infrastructure to support more housing. Today, competition for underground space is fierce, as cities look to install more fibre optic cables to ensure access to fast internet, upgrade stormwater systems to handle flooding and more sewage intake, bury transmission lines to protect them from extreme weather and build transit. 

Local governments are arguing it no longer makes sense that Enbridge Gas — a for-profit company — gets to use this much-needed space for free, while almost everyone else has to pay. 

So, what’s stopping Guelph and Waterloo Region from just negotiating new agreements with Enbridge Gas? 

Well, the law. 

Provincial regulation doesn’t allow municipalities to charge fees to build utilities under roadways. Both Guelph and Waterloo Region have asked the Doug Ford government to change the regulation, but neither council has received an official response yet. 

As has been the case since June 2024, no one from the premier’s office or the ministries of Energy or Municipal Affairs responded to questions from The Narwhal. 

Both municipalities could appeal to the Ontario Energy Board, but the independent energy regulator is also mandated to uphold provincial law. 

Not signing is the only option at present. In the event the regulation changes, it means these two municipalities won’t be locked into a 20-year agreement to provide free access to their lands. In the interim, the agreement continues as is on a month-by-month basis. 

Do municipalities outside Ontario allow fossil fuel companies to build on public land for free? 

Not really.

British Columbia, Alberta, Saskatchewan, Manitoba and Nova Scotia allow municipalities to charge utilities to build on their land, which has raised tens of millions for certain cities. 

For example, per Ottawa’s letter to the government, Edmonton has been charging gas utilities access fees since 1915. There, utilities pay 32.9 per cent of delivery charge revenues to the municipalities to use their right of way. If the Edmonton approach were applied in a city a little bigger than Guelph and Waterloo Region combined, the annual compensation would be approximately $66 million, according to calculations from the City of Ottawa.

In Calgary, the city’s website says revenue collected from similar fees “contribute to keeping property taxes low” and also “invested into new facilities and other amenities” that “are carefully designed to benefit Calgarians directly.” 

Are there any other municipalities considering not renewing their agreements with Enbridge Gas?  

Not that we know of, but both Ottawa and Toronto have expressed concerns.

In March 2024, Toronto City Council — whose agreement looks slightly different from others across the province — asked the Ontario government to change the regulation around its agreement to allow it to charge for-profit gas utilities for using public land. City staff noted, “A key difference between the use of the right of way for natural gas and all other uses is that natural gas is a fossil fuel that causes climate change.”

In 2022, Ottawa asked the government for something similar, noting the 20-year contract is misaligned with pledges to lower emissions by 2050. In its letter, the city asks the board to consider allowing municipalities to recoup five per cent of gas revenues from Enbridge Gas. 

Guelph’s Mayor Guthrie said other Ontario mayors are “poking and prodding” on this issue “because these types of contracts are applicable across almost every municipality.”“So we’ll see how it goes, and we’ll see what happens next in both the Ontario Energy Board general review and with the specific review of the city of Guelph and Enbridge.”

Enbridge Gas is taking Guelph to the Ontario Energy Board. Why — and what can the board do? 

Enbridge Gas wants Guelph to sign the franchise agreement as is and has also told Waterloo Region council to do the same. 

In a public presentation, Enbridge Gas representatives told Waterloo council that the board has “regularly denied” municipal proposals to amend the agreement, and that signing one “does not obligate customers to continue using natural gas.”

In a filing with the board, the company has said it “does not support” any of Guelph’s proposed amendments and asks the board to compel the city to follow the law and renew. In the same filing, the company states it would be “inappropriate” for the board to consider Guelph’s suggestions as it “could have cascading implications” on other municipalities. A decision from the board is expected in spring 2026.

Looming above all of these future board reviews and deliberations is the outcome of Enbridge Gas’s last big case at the Ontario Energy Board. In early 2024, the Ford government overruled the regulator’s decision that Enbridge Gas should pay the cost of new gas infrastructure upfront, or put it on developers, rather than continuing to pass it down to homeowners on their bills.

“It is always the prerogative of governments to make policy and seek to pass laws,” Tom Miller, a board spokesperson, told The Narwhal in an email. “Our approach has not changed.”

This next decision could be even more significant. If Guelph and Waterloo Region are successful in changing the terms of their agreements — with numerous other municipalities potentially following suit — it could mean a future where pipelines no longer create a void in government coffers, and instead make space across Ontario’s energy landscape for green technology.

Updated on Dec. 22, 2025, at 3:25 p.m. ET: This story has been updated to correct a line saying Enbridge Gas pays a percentage of its natural gas delivery charge back to the City of Edmonton. In fact, Enbridge Gas does not operate in Alberta. Other natural gas suppliers pay 32.9 per cent of that charge to Edmonton for their use of pipeline right of ways.

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When Ontario Energy Minister Todd Smith publicly decried an independent regulator’s decision to force a fossil fuel giant to pay for new household gas connections, he argued it would drive up the cost of new homes and delay construction. But internally, senior officials in Premier Doug Ford’s office noted the decision would create a “magnitude” of costs for Enbridge Gas and developers, internal emails reveal.

Officials made the observations in late December, hours before the government announced an unprecedented decision to overrule the Ontario Energy Board. The intervention came soon after the independent energy regulator ordered Enbridge Gas on Dec. 21 to stop passing down the costs of new natural gas connections to homeowners on their monthly bills. 

In a 147-page decision, the board told the fossil fuel giant that, starting in January 2025, it would have to ask developers to pay these costs in full and upfront or risk paying it themselves. The board considered how climate change is forcing an energy transition that will likely make natural gas useless and financially unviable, or “a stranded asset.” Despite its name, natural gas is a significant contributor to the climate crisis, as it is made up mostly of methane, a heat-trapping chemical compound and powerful greenhouse gas. 

The board found that homeowners would pay more if natural gas is not weaned off now, first to help cover the costs of natural gas connections and then for retrofits when the fossil fuel is no longer used.

But internal records released through freedom of information legislation to Environmental Defence, an advocacy group, and shared with The Narwhal, reveal how high-ranking staff in Ford and Smith’s offices, as well as the Ministry of Municipal Affairs and Housing, discussed a public relations strategy around overriding the regulator’s decision with legislation that would ultimately put homeowners on the hook for the costs.

The emails also reveal staff in Ford’s office were expecting government lawyers to object to their intervention, but said they wanted to proceed despite the risks. The same staff made extensive edits to the energy minister’s response to link it more closely to housing costs, interest rates and inflationary pressures — three of Premier Ford’s focuses in his public messaging over the last several months. Per the emails, high-ranking staff in the energy minister’s office also communicated with Enbridge before and after the decision was released. 

“The most glaring thing in these documents is that Enbridge clearly has very good access to the highest levels of this government,” Keith Brooks, programs director with Environmental Defence, told The Narwhal. “We see staffers working after hours to issue this press release and essentially do Enbridge a favour.” 

No one from the premier or energy minister’s office cited in these documents responded to The Narwhal’s request for comment. 

A timeline of Ontario’s response to the energy board decision

At 6 p.m. on Dec. 21, the board — an independent regulatory body — released a 147-page decision that would prevent Enbridge Gas from passing the costs of connecting new homes to natural gas onto homeowners. 

After reviewing Enbridge Gas’ plans for the next five years, the board argued the company’s proposal would lead to “an overbuilt, underutilized gas system” as the world moves away from fossil fuels toward renewable energy. Homeowners have historically paid connection charges off incrementally on their bills over 40 years, but starting January 2025, the board said Enbridge Gas would have to charge developers for the full costs upfront instead — or cover it themselves. The board said the requirement could push developers to consider more eco-friendly, economical alternatives such as heat pumps to cool and heat buildings. 

Some 15 hours later, on Dec. 22, at 9:30 a.m., Energy Minister Todd Smith responded in a statement, vowing to introduce legislation to reverse the decision that he said would add “tens of thousands of dollars” to the cost of building new homes. That legislation — the so-called Keeping Energy Costs Down Act — was announced on Feb. 22, and debated at government committee hearings earlier this month.

The internal correspondence appears to show how the premier’s office was significantly involved in crafting the energy minister’s statement. 

At 11:47 a.m. on Dec. 21, David Donovan, Smith’s chief of staff, set up a Microsoft Teams meeting marked of “high” importance. Titled “Urgent Touch Point: New Homes/Natural Gas,” he invited 15 people across the premier’s office and Energy and Housing ministries. This included Patrick Sackville, Ford’s chief of staff, and Travis Kann, Ford’s deputy chief of staff for strategic communications. 

“Hi folks, I hate to send this invite today, but the Ontario Energy Board will release their Enbridge rate decision late today, regarding natural gas rates and new natural gas connections,” Donovan wrote in the meeting invite. “My experience in this sector has me significantly concerned that I think we need to raise to this level. If incorrect, we will cancel or down-grade this meeting before 5 p.m.” (Donovan served as a senior government affairs strategist for Enbridge between September 2013 and August 2018.)

By 5:55 p.m. — minutes before the Ontario Energy Board’s decision was released publicly —  officials in the Energy Ministry were circulating a draft official response. Staff dismissed any possible legal concern in favour of strong messaging on the board’s decision before government lawyers had a chance to review the statement. “Legal will inevitably flag risks with pausing a decision and signalling legislation. We need to tell them that we understand those risks and are proceeding,” Kann wrote. 

Staff dismissed the legal risks again after they were submitted by lawyers, but the risks are redacted from the documents.

“We’ve had this risk flagged to us countless times before and each time it isn’t in any way a material factor. We need to proceed with saying we will introduce legislation otherwise the message is weak,” Kann wrote. “Please get the statement live.” 

Staff consulted Enbridge Gas before energy minister’s statement was released

The documents also show that high-ranking officials from the energy minister’s office communicated with Enbridge Gas for input on the statement. 

Before the government released its statement on Dec. 22, Sackville, Ford’s chief of staff, asked for an additional change to ensure the minister commented on potential impacts on the costs of building houses. 

“Also would be great to add something about the magnitude of these costs — I expect it to be tens of thousands of dollars in additional costs,” he wrote in an email. “Additionally, the consequence of this decision would be slowing/halting thousands of new units of housing (including affordable housing) across the province. Need to keep costs down and improve certainty to keep building in face of all other headwinds.” 

Both of those thoughts are in the final version of the statement, in some cases, word for word.

Donovan responded to Sackville’s email by suggesting they avoid specific cost amounts because they don’t know the financial implications of the decision yet.

“Enbridge will get us more tomorrow morning,” Donovan wrote. In a briefing note shared with the minister after this email conversation, government officials noted that “the upfront costs incurred by Enbridge to connect new customers are substantial.” (The impact of transferring these costs to developers have since been found to be minimal.)

The same day the government released its statement, an Enbridge official expressed the company’s gratitude in an email sent to Donovan, Sackville and others. “We appreciate the Ontario government’s ongoing efforts to support our common priorities to deliver reliable, affordable and sustainable natural gas to Ontario homes and businesses across the province,” the official said. 

The internal documents also show that in January, the company reached out to the premier’s office for a meeting between Sackville and a senior Enbridge executive based in Calgary. 

In a lengthy email response to The Narwhal, Enbridge Gas spokesperson Leanne McNaughton said the company held “informational briefings” with the Ontario government on its application to the board.

“As a responsible gas supplier, Enbridge Gas maintains transparent communication with all levels of government in the regions where we operate,” she wrote. “This helps us ensure that our residential, commercial and industrial customers continue to have access to a resilient energy source of their choice, especially when disinformation can damage energy and housing affordability.” 

“Enbridge Gas has been transparent and consistent in its communications with all stakeholders about the [Ontario Energy Board’s] decision,” she said. 

McNaughton said this transparency included “debunking and avoiding untrue claims” like the fact that the government’s legislation to overrule the board will pass the costs of natural gas hookups to Ontarians or increase their monthly energy bills. “This is simply not true,” McNaughton said. She argued that the board has yet to approve the new rates for natural gas beyond 2024, so any increase has yet to be confirmed. 

McNaughton said the board’s decision “would increase the cost of building a new home or opening a small business at a time when Ontario faces a housing and affordability crisis.” 

“Sharing such misleading and inaccurate information to serve certain agendas could have damaging ramifications on affordability,” she added.

Independent experts have said the board’s decision would decrease costs for homeowners, while the government’s legislation that overruled the board will have “virtually no effect on affordable housing in the province.” 

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A $1 billion government oil and gas cleanup program is coming to an end in Alberta. Data analyzed by The Narwhal shows over half of known spending flowed through just three oil and gas companies and a municipality.

The program was announced in 2020, after the federal government pledged $1.7 billion for B.C., Saskatchewan and Alberta, the bulk of which went to Alberta. 

Two companies, Canadian Natural Resources Limited and Cenovus, accounted for 44 per cent of Alberta’s spending. Canadian Natural (CNRL), the largest oil producer in Canada, received at least $172 million in subsidies. Cenovus received almost $66 million.

The other two big recipients were the City of Medicine Hat, which owns natural gas facilities, at $22 million and IPC Canada Ltd. at $18 million. Collectively, the four entities accounted for 51.5 per cent of known spending.

Those figures only apply to a little over half of the billion dollars that the federal government sent to Alberta. There is no public data on which companies received money for the first three granting periods, accounting for approximately $416 million in spending. Two other granting periods gave money directly to First Nations and Métis communities to pay for clean up on their lands and the figures don’t include how much went to each oil and gas company.

The money went to service companies contracted to do everything from capping inactive wells to site assessments and reclamation work. While the money was not given directly to the oil and gas companies, it offset their expenses by covering costs to clean up wells owned by those companies.

The program also focused on supporting Indigenous-owned businesses doing the actual cleanup work. 

Public data shows four of the top five companies, accounting for $156 million of almost $700 million listed so far, were either directly owned by First Nations, were an Indigenous-owned company, or, in the case of Vertex Resource Group, partnered with First Nations and Indigenous-owned companies.

Those figures include all granting periods, but not all invoices have been paid at this time. 

Cenovus, Canadian Natural and IPC did not respond to interview requests. A spokesperson for the City of Medicine Hat said they were unable to set up an interview prior by publication time.

The Site Rehabilitation Program and its critics

When he first announced the funding in April 2020, Prime Minister Justin Trudeau said the government’s goal was to “create immediate jobs in these provinces while helping companies avoid bankruptcy, and supporting our environmental targets.” 

At the time, the oilpatch languished under collapsing prices due to the pandemic and an oil price war between Russia and Saudi Arabia. 

The intent was to put oilfield service companies to work cleaning up wells instead of drilling new ones, but critics were quick to question the federal largesse, particularly as a violation of the polluter pay principle — where a company that makes a mess ought to pay to clean it up.

Despite Trudeau saying the program would help clean up orphan wells — a growing problem in Alberta that refers to wells which no longer have an owner with the resources to clean them up — none of the money was directed at the issue. 

“Trudeau does this really kind of eloquent announcement about the program saying, yes we need jobs, but also we need to clean up orphan wells — he said inactive and orphan wells — we need to help struggling companies avoid bankruptcies,” says Megan Egler, a researcher and PhD candidate who wrote a report on the program for the Parkland Institute and Oxfam Canada.  

She says the prime minister also touched on the impact of orphaned and inactive wells on landowners, municipalities and Indigenous communities. 

“These goals all kind of got distilled down to two by the Alberta government,” Egler says, noting it’s hard to say whether the program was successful given those terms. 

“So now we’re just talking about jobs and cleanup activities. Which, I guess that shift in narrative is important because, did it create jobs? It did. Did it clean up? Well? It did, but it completely erases any talk about the polluter pays principle, which it completely violated.”

She says the metrics to measure the success of the program ignore environmental outcomes, including things like methane emissions from old wells, and there is insufficient data on which wells were capped or cleaned in order to determine if they were the highest risk locations.

There are currently over 7,000 orphan sites in Alberta waiting to either be decommissioned or to undergo environmental remediation, according to the Orphan Well Association, an industry-funded group that cleans up wells left behind by bankrupt companies. 

When the Parliamentary Budget Office released a report into the program in January, 2022, it found more than half the money distributed in Alberta was going to companies that were financially steady. 

The report said there was a risk the program would not be successful in reducing Alberta’s oil and gas liabilities if the money was not directed at firms in “acute financial risk.”

According to the Alberta Energy Regulator, there are currently a further 76,000 inactive wells — those owned by solvent companies but which are not producing oil or gas. Some of those have been inactive for decades. 

In addition, there are 170,000 wells in the province that have been abandoned — capped and put out of service — but which have not been reclaimed. 

CNRL, which posted $2.8 billion in earnings in the third quarter of 2022 alone, tops the regulator’s list with 22,536 inactive wells, followed by Cenovus with 5,638.

CNRL also said in its third quarter report that in 2022, it has so far returned approximately $4.9 billion to shareholders through dividends, “an increase of approximately $2.8 billion, or 127 per cent  from 2021 levels.”

Other major oil and gas companies, including Cenovus and IPC have posted significant profits over the past year.

The Alberta Energy Regulator said it did not have data on the Site Rehabilitation Program and directed questions to Alberta Energy. 

A spokesperson said the program was the responsibility of the government and the regulator did not “track any information about the program or its impacts.” 

Over 30,000 oil and gas sites covered under the program

The program did, however, deliver some results. 

According to the province, as of Feb. 10, there was work completed on 31,925 sites — 16,605 for abandonment, 7,344 for environmental assessments, 7,181 for reclamation and 1,552 for remediation.

The province says the program temporarily generated 4,700 jobs to date, short of its original projection of 5,300. 

A report by the auditor general of Alberta from March 2022, noted Alberta Energy was specifically looking at the number of jobs created and the total number of approved grants in order to evaluate the success of the program. 

It also noted the method for determining job creation could overstate the impact. 

The energy minister’s office says the province will continue to process invoices, which will take several weeks, and a final tally on who received funds will then be calculated. 

The Narwhal asked the minister’s office why there is no data for the first three reporting periods. Gabrielle Symbalisty, the acting press secretary for the minister, says there is no information on the first two periods because the provincial government applied a different funding formula for those grants. When asked to clarify why this prevented the government from releasing figures, she did not respond.

In period three, every licensee “determined by the Department of Energy to be an active oil and gas producer in Alberta” each received up to $139,000 in funding, but Symbalisty did not respond to a question about why those producers certified by the government were not listed.  

“There has been a significant acceleration in the pace of closure of inactive oil and natural gas infrastructure in Western Canada,” says Richard Wong, director of regulatory and operations at the Canadian Association of Petroleum Producers, when asked if the program reduced oil and gas liabilities. 

He said the program supported the sector during the pandemic and downturn and helped create jobs. 

A spokesperson for Chrystia Freeland, Canada’s finance minister, did not respond to a request for comment prior to publication.

‘Raining money from Ottawa’

Regan Boychuk has been pushing for better regulations to force companies to clean up their inactive wells for years. 

Boychuk, who worked as a researcher for the Albert Liabilities Disclosure Project when the federal program was announced, says they pushed the Trudeau government to offer loans instead of grants for the clean up of wells and urged there to be conditions tied to the money. Neither of those suggestions were included in the program. 

And, while he says there are some positives coming out of the program, the work was only done because “it was raining money from Ottawa.”

“The main beneficiaries, the big, incredibly profitable, money coming out of their pockets companies, that’s not who we should be giving free money to, they don’t need it, we can make them simply follow the law and they can spend their own money,” he says. 

He laments there is not more data on the outcomes of the program and what exactly was achieved. (Boychuk is running for the Green Party in the next provincial election.)

The end of the Site Rehabilitation Program comes just as the province enters a fresh debate on subsidies to oil and gas companies to clean up the mess left behind by their operations. 

The province has launched a pilot project that would give royalty credits on new production to companies for cleaning up wells that have been inactive for at least 20 years — a scheme Premier Danielle Smith lobbied for before she was elected. 

Wong says his lobby group is looking forward to consultations with the government on that plan — first called RStar and now renamed the Liability Management Incentive Program. 

Boychuk says he’s not surprised that it’s being introduced now and worries that no one is interested in enforcing the polluter pay principle. 

“It takes a real feat of ideological blindness not to see how much money is coming out of the ground, how big of a mess is being left behind and how we’re being cheated,” he says. “It could not be more transparent or clear.”

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It’s a sunny day in Canada’s boreal forest. A man in a white hardhat and blue jumpsuit studies a tablet, evergreens to his left, pipelines to his right.

As he turns and starts walking, a woman’s voice intones, “It’s time to clear the air: oilsands contribute significant carbon emissions in Canada.”

The man is transported into a busy office. He shows the tablet to a worker, who nods approvingly. The woman’s voice reveals that six companies have “joined forces” on carbon capture technology to meet global energy and climate goals.

The logos of the companies then appear on screen: Canadian Natural Resources, Cenovus Energy, ConocoPhillips Canada, Imperial Oil, MEG Energy and Suncor Energy.

The ad is for the Pathways Alliance, a group of oilsands firms which together represent the major players. It ends with the voice inviting the viewer to “come see what we’re doing.”

So, just what are the Pathways companies doing?

The alliance has pledged to achieve “net-zero emissions from oilsands operations by 2050.” Achieving that goal would be a tremendous feat, roughly equivalent to cutting all the yearly emissions of the province of Quebec.

But critics say the pledge is just another greenwashing tactic designed to extend the life of fossil fuels.

These were the recent findings of a year-long U.S. Congressional probe that turned up stunning evidence of corporate deception.

The U.S. House of Representatives’ central investigative committee found that oil companies publicly touted carbon capture technology as key to climate mitigation, but internally viewed the technology as a means to secure a “social licence” to continue producing fossil fuels for decades.

Internal documents and emails from top U.S. oil companies and trade associations, obtained by the committee, showed how an industry proposal in 2021 to lower carbon pollution rested on a strategy to tackle emissions from a company’s operations — rather than its products — in order to “further secure the industry’s licence to operate.”

The Pathways plan relies heavily on carbon capture technology. The alliance has proposed a $16.5 billion megaproject that would collect carbon dioxide from almost two dozen facilities in the oilsands and transport it to the Cold Lake area, northeast of Edmonton, Alta. There, the alliance says, it will be injected into rock formations underground and sealed off.

The plan also involves targeting pollution from its members’ operations — drilling for petroleum deposits in the oilsands — rather than the emissions created from its products, like when people drive cars running on gas made from oilsands oil.

Activities like this are where the vast majority of pollution derived from oil comes from. That matters especially for Canada, because it exports most of the oil it produces; about four-fifths of domestic oil production was sent abroad in 2021.

The Pathways plan, as they’ve put it, is to “become the global supplier of choice for responsibly produced oil”—– a bid to use “next generation” technology to help slash operational emissions while they continue producing and selling petroleum products.

“I think those [Congressional] hearings were important because they showed that this has been going on for a very long time, that Exxon has known, oil and gas companies have known, for many, many decades, that the burning of fossil fuels is causing climate change,” said Catherine McKenna, the former Canadian minister of environment and climate change.

“They have pushed disinformation campaigns, they have organized against good policy, they’ve worked to discredit the science, and look at where we are.”

A pathway ‘from dirty to clean’

McKenna recently chaired an expert panel established by United Nations Secretary-General António Guterres, which made recommendations for net-zero pledges from large corporations. The 16-member panel came to a number of conclusions at odds with the Pathways plan.

For one, they concluded that net-zero pledges from corporations must come with a target aimed at ending the use of, or support for, fossil fuels. That’s what’s in line with scientific conclusions through the Intergovernmental Panel on Climate Change, and other modelled pathways that limit warming to 1.5 degrees Celsius, as well as the limits under the 2015 Paris Agreement on climate change.

For energy companies, that means ending oil and gas production, the panel said, as well as ending exploration for new oil and gas fields and ending expansion of oil and gas reserves.

Global oil and gas use will actually have to be phased out in developed countries even faster than planned to meet 1.5 C, because modelled pathways so far have relied too heavily on eliminating coal, according to a peer-reviewed study published in February in the scientific journal Nature Climate Change.

The expert panel found that corporate net-zero pledges should include plans to slash the carbon pollution from a company’s “full value chain and activities” — meaning when people use products that were derived from a company’s products.

And it’s not enough for companies to state climate ambitions and then go about business as usual. Firms must also overhaul their corporate strategy, including investment plans, said the panel, to ensure emissions targets are kept in mind during day-to-day operations.

“You need to show a pathway for your investments from dirty to clean. They aren’t doing that,” said McKenna.

The alliance’s website says the Pathways companies recognize climate change as “a critical challenge of our time” and that industry has an “essential role” to play in helping Canada meet its climate goals.

Pathways president Kendall Dilling, who was an executive at Cenovus before being appointed president of the alliance in 2022, has acknowledged emissions from the consumption of oil products are “part of what we have to get to, as well.”

The organization is “looking at ways we can partner with end-users of our product to also tackle the consumption issues,” he told BNN Bloomberg.

But until then, Pathways is focusing on pollution from its activities, not its products, Dilling explained, because “we wanted to really start with our own business first, and take care of our own backyard.”

In the meantime, the oilsands companies are talking about going in the other direction: ramping up their production of fossil fuels.

Record profits to shareholders, cap-in-hand to governments

Imperial Oil, for example, said in December 2022 it was expecting “continued production growth” at its Kearl oilsands site. (Kearl, northeast of Fort McKay, Alta., has been leaking wastewater for close to nine months, leading to a recent environmental protection order issued against it by the province’s energy regulator. The company says it has been working with the regulator and will put in place new measures.)

In late January, Imperial Oil announced $7.3 billion in profits in 2022, the strongest financial results in the company’s entire 143-year existence. That success, it said, was due to the company benefiting from “a steady increase in oil and natural gas prices and refining margins.”

“We’re closing the books on what was the best year in the company’s history,” Imperial Oil president Brad Corson said during the firm’s January earnings call. The company is majority-owned by Texas-based ExxonMobil.

The Pathways plan is expensive, coming in at around $70 billion, according to Cenovus CEO Alex Pourbaix. But by the time Imperial Oil closed the books on 2022, it had “returned over $7 billion to its shareholders” that year, according to its fourth-quarter results.

The company does have various climate initiatives, including a $720 million “renewable diesel” project which it says could help cut three million tonnes of emissions per year, another technology it claims can cut emissions intensity by a quarter, and a new boiler configuration it says will cut 0.2 million tonnes of emissions per year.

But many of those projects, and others announced by Pathways members, are rolled out over many years and often involve studies or activities where the dollar figure is hard to pin down.

In a November 2022 statement from Pathways that outlined “decarbonization projects underway this year,” for example, the alliance pointed to a $1.4 billion boiler replacement project at Suncor first announced in 2019. Pathways says its members have “invested more than $10 billion” on research and development, but that figure stretches all the way back to 2012.

The story is similar at other Pathways companies. Canadian Natural Resources made $9.4 billion in profits during the first nine months of 2022, and then paid out $8.4 billion in combined share buybacks and dividends, and expects to grow oil production. The alliance said the company was working on technology that could cut emissions intensity 40 per cent — a pilot project that began in 2021. Cenovus, which has a half-dozen studies in play to implement carbon capture, made $5.6 billion and paid $2.5 billion to shareholders, and also expects to grow oil production. Suncor has budgeted for low-carbon investments through 2025.

Meanwhile, the companies have spent just $500 million as of late January on the first phase of the Pathways plan, according to Dilling. They are holding off on committing more funding until governments sink more public dollars into it first.

Pathways companies have engaged media many times over the past year, arguing that the federal government’s $2.6 billion tax break for investments in carbon capture projects is not enough. They would prefer governments fork over $10.9 billion, or two-thirds of the carbon capture project’s upfront cost.

Environment and Climate Change Minister Steven Guilbeault has repeatedly said it’s the companies’ turn to step up and make big climate investments using their profits.

“It is encouraging that oil and gas companies are committed to achieving net-zero. While oil and gas companies are making record profits that they are putting towards share buybacks and dividend payments, they should also be re-investing in the decarbonization and diversification needed to reach their goal of net-zero,” Environment and Climate Change Canada spokesperson Samantha Bayard told The Narwhal.

The industry has said it cannot invest more, even as the Alberta government has introduced new credits for carbon capture and storage in January as part of its industrial pollution program, which meets federal government benchmarks under Canada’s carbon pricing system.

Oil and gas companies have also so far avoided windfall taxes on their profits in Canada, taxes that have been enacted in the United Kingdom, the European Union and India. Prime Minister Justin Trudeau has dismissed the idea of a windfall tax, although his government has also proposed a share buyback tax that would come into force in 2024.

The energy companies argue Canada’s royalty system is already a form of windfall tax. And Pathways has defended its demands for more government money by arguing that oil companies are subject to volatile commodity markets, and can’t be expected to plan long-term investments based on the profitability of one year.

“It would be difficult to successfully plan a three-decade investment based on the price of oil today, and it would be impossible to remain globally competitive without government financial and policy support,” the alliance said in a statement.

McKenna, who is also the founder and principal of the Ottawa and New York-based advisory firm Climate and Nature Solutions, argued that the principles of net-zero pledges that her panel came up with are incompatible with “spending all your money to give dividends to shareholders and executive compensation, while you’re making money.”

Net-zero means “actually investing in the technology you say you need,” she said. Oil and gas companies “need to be reducing emissions now … if you’re very serious about it, you would actually be making the investments right now while you have a lot of money.”

Pathways Alliance says it’s working on ‘suite of technologies’

The Narwhal reached out to Pathways Alliance, and to each of the six individual member companies, to ask them about the expert panel’s conclusions and how the Pathways plan fits into them. A spokesperson from Pathways acknowledged the media inquiry but did not offer comment before publication.

None of the companies responded to requests for comment about the panel, their earnings and investments, or McKenna’s criticism.

Pathways has pointed to planned research on the use of hydrogen gas or nuclear reactors in the oilsands to generate non-emitting power. It says it is working on a “suite of technologies” to reduce the need for steam in oil production, electrify mining trucks, use geothermal energy to make hot water and other pursuits.

The alliance also says its engineers are working on “next generation technologies” for carbon capture, highlighting a joint Cenovus partnership with a Vancouver-based clean-tech startup, as well as a Canadian Natural Resources pilot project near Edmonton.

Jonathan Arnold, clean growth research lead at the Canadian Climate Institute, said the organization still considers carbon capture to be a “wild card.”

“It hasn’t been fully commercialized, such that it can be replicated and deployed at a scale required to bring down the sector’s emissions to net-zero,” he said.

While research continues over how to capture emissions, Arnold said the global energy market is tilting towards renewables and low-carbon technologies. Things like the U.S. Inflation Reduction Act, the prevalence of electric vehicles and batteries and an environmental shift in capital markets are going to put increased pressure on fossil fuels.

The U.S. Congressional investigation showed how the industry is thinking about ensuring its assets don’t become stranded in a low-carbon world. Investigators revealed how Shell executives understood that selling off assets essentially hands off the responsibility for cutting emissions. When one executive defended the practice, they said, “[w]hat exactly are we supposed to do instead of divesting … pour concrete over the oilsands, and burn the deed to the land so no one can buy them?”

Canadian oilsands companies need to be clearly laying out in their capital plans how they will be “transforming” so that they can “deal with the coming decline in oil and gas,” Arnold said.

“I don’t think that we see that currently,” he said. “It’s not just about decarbonizing operations, it’s also about just investing in new lines of business.”

Yet the world has still not given up on fossil fuels, Dilling has argued, and until that day comes, oilsands companies are still in the business.

“The world’s going to be using fossil fuels for some period of time, so we want Canada to produce the cleanest, lowest-carbon barrel of oil to the world for as long as that market exists,” he said during the BNN Bloomberg interview.

Nailing down the Pathways Alliance numbers

The alliance has declared one interim climate target of cutting emissions by 22 million tonnes by 2030, but beyond that, numbers seem to be in flux.

The “magnitude of (emissions) reductions in each decade can be adjusted,” Pathways acknowledged in October 2022. A graph on the alliance’s website, titled “our three-phased approach,” shows a timeline for reducing emissions, divided into three decades, but the graph had no numbers on it at the time The Narwhal viewed it.

The Narwhal asked Pathways if it had committed to any additional interim targets, or if it had any specific numbers for its emissions reduction graph, but did not hear back.

McKenna’s expert panel recommended that net-zero pledges contain short, medium and long-term emission reduction targets, with the first target set for no later than 2025, as the Paris Agreement requires that countries increase their national climate ambitions that year.

The magnitude of emissions reductions from Pathways matters, not just because of the climate impacts, but also because of how widespread the economic activity will be from its carbon capture project — and what kinds of jobs will be available for workers in an industry in transition.

Pourbaix, CEO of Cenovus, told The Canadian Press that Pathways’ plan would create 35,000 jobs. He was speaking after the federal government said it would introduce “just transition” legislation in 2023 to help retrain oil and gas workers for jobs in the low-carbon economy. Pathways says it welcomes efforts to transition the oilsands workforce.

But a presentation from the alliance also puts Pourbaix’s figure in context. The Pathways plan “protects 25,000 to 35,000 existing jobs,” it said, an umbrella figure which includes 1,000 “permanent, direct jobs” after construction. The rest are either temporary jobs created during construction or indirect or induced jobs created as a result of the business activity generated by the plan.

The Narwhal asked Cenovus if it could clarify the alliance’s jobs projections, but did not hear back.

Beyond how to organize their businesses and where to invest their money, the expert panel also had recommendations for how corporations with net-zero pledges should behave when it came to lobbying the government.

Corporations should lobby for “positive” climate action, and publicly disclose plans that show how their lobbying activities were consistent with their net-zero targets, the panel said.

Pathways has lobbied extensively for government funding for emissions reduction initiatives. But the alliance has also criticized the federal government’s Emissions Reduction Plan.

The government’s projections that the oil and gas sector would contribute an emissions reduction equivalent of 42 per cent from 2019 levels by 2030 is “simply not realistic given current technology, construction and regulatory requirements,” Dilling wrote in an op-ed.

Individual members of Pathways have also lobbied against climate action. Canadian Natural Resources lobbied to weaken regulations on methane, a potent greenhouse gas, while Suncor has lobbied against climate financial transparency.

Companies that care about being net-zero need to pay a “price of admission,” said McKenna. Net-zero pledges that don’t measure up are an example of the “new form of climate denial.”

“It’s actually saying you’re doing something, and doing the opposite — which in a way is worse, because it creates the impression that we’re actually making progress on climate change, that folks are showing climate leadership.”

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The BC Natural Resources Forum attracts a who’s who of the forestry, mining and oil and gas sectors to its annual gathering in Prince George. 

This year, the forum offered a fireside chat on LNG exports sponsored by Petronas, a pre-banquet trade show reception sponsored by Coastal GasLink, a resource ministers’ breakfast sponsored by Tourmaline Oil and, for an extra $600 per person, a sold-out, six-hour workshop called “When ‘It’ Hits the Fan: Crisis Communications in Uncertain Times.”

(“Companies today live in a fishbowl of public scrutiny,” the workshop blurb stated. “When you’re in the spotlight, saying the right thing is just as important as doing the right thing.”) 

Also included in the two-day line-up was a workshop called “Innovations in B.C.’s natural gas industry.”

The workshop’s sponsor? The Alberta government’s Canadian Energy Centre, better known as the energy war room, a provincial corporation that, according to its annual report, received $7.7 million in government funding in the fiscal year ending March 31, 2022.

The war room was established by former Alberta premier Jason Kenney in 2019 to counter what he dubbed disinformation about the oil and gas industry and rebut “every lie ever told by the green left about Alberta’s world class energy industry.” (A subsequent $3.5 million inquiry into the so-called green left and what Kenney called its “special-interest foreign funders” found no suggestion of wrongdoing or illegal actions on the part of any individual or organization.)  

The war room’s presence at the BC Natural Resources Forum is perhaps not surprising, given its push for the expansion of B.C.’s nascent LNG industry and promotion of new LNG projects being considered by the B.C. government.

But some say Alberta –– a province notoriously quick to tell other jurisdictions to butt out of its affairs — is overstepping as B.C. Premier David Eby and his cabinet grapple with difficult LNG decisions after reaffirming the government’s commitment to climate action. 

Chief among these decisions are how to balance carbon pollution from any new LNG projects with already missed greenhouse gas emissions targets, the fractious question of oil and gas subsidies and what to do about target-blowing emissions from Phase 2 of the LNG Canada project, which appears poised to proceed.  

The project, which will liquefy fracked gas from B.C.’s northeast, sent to Kitimat through the Coastal GasLink pipeline, is Canada’s first LNG export project.

“I think it is definitely strange to see a Crown corporation from another province sort of meddling in the affairs of a neighboring province,” Peter McCartney, climate campaigner for the Wilderness Committee, told The Narwhal. “We’ve always known that they’ve been a publicly funded gift to the oil and gas industry. And this is just more evidence of that.” 

Canadian Energy Centre CEO advocates ‘responsible oil’ communications plan

Canadian Energy Centre CEO Tom Olsen, a former journalist and former United Conservative Party candidate, spoke briefly at the BC Natural Resources Forum panel, asking the audience to stand up and down to make a wave and saying he felt right at home because Prince George was culturally “like Alberta.” The panel focused on initiatives to increase production and reduce carbon pollution in individual fracking operations, sidestepping the issue of how such innovations will compensate for rising emissions from the fracking boom poised to begin to supply LNG Canada.

Olsen described energy centre ads that promote its Made the Canadian Way campaign, which makes the case for LNG and other Canadian oil and gas products on the grounds they are cleaner and more “responsible” than products from other countries. “Basically, the ad is you want to know your Nike shoes aren’t made in a sweatshop, you want to know your diamonds aren’t blood diamonds,” Olsen said. “If you use Canadian energy, here’s what you would learn.”

Olsen said the Canadian Energy Centre has been “around the world” with its message. “We do targeted digital campaigns, the G7 in Germany in June, COP27 in Egypt in November, the [offshore northern seas conference] in Norway this summer and the International Energy Summit in the U.K. in September. And we get millions of hits,” he said.

The centre has spent $412,253 on Facebook and Instagram ads since March 2020, disclosures from the Meta ads library show. One of the themes of the digital campaigns is Canada’s ability to reduce carbon emissions around the world, Olsen said. “I say it consistently — and no one really disputes it —  if we can get our natural gas to cooperating jurisdictions, we have an immediate impact on greenhouse gas emissions.”

The energy centre claims Canadian LNG will be among the least carbon intensive in the world. 

But University of British Columbia political science professor Kathyrn Harrison said the centre is “notoriously selective — and selective to the point of misleading — in the arguments that they make.” 

If Canadian LNG were the least-carbon intensive in the world to produce, it would be the least carbon intensive over its life cycle, because each tonne of methane produces the same emissions when burned, Harrison pointed out. “The questions then are whether LNG is actually replacing more GHG intensive energy sources, or cleaner ones — and how Canada will meet our emissions targets, given significant emissions increases to produce the gas and operate LNG terminals.” 

Harrison is also concerned by the energy centre’s claim that real emissions reductions will begin in five years and reach net zero in 30 years, “even as they oppose an oil and gas cap that would put the industry on a trajectory to achieve that.”

McCartney said it’s been “incredible” to watch the war room market B.C. LNG as clean and produced to a higher standard than LNG from other countries, suggesting it has taken a page from Ezra Levant, founder of the far-right website Rebel Media and author of the book Ethical Oil: The Case for Canada’s Oil Sands. 

“It’s nonsense, our oil and gas pollutes, just like other oil and gas from all over the world,” McCartney said. “And in many cases, our oil and our fossil fuels are some of the worst on the planet. There’s this idea that the Canadian oil and gas industry is different [and] is somehow not causing climate change. It’s actually even talking about decarbonizing fossil fuels as if that is a real possibility. And it’s complete greenwash. Canada is one of the largest exporters of the fossil fuels that are causing climate change. And we need to rein that production of these polluting products in as soon as possible, just like the rest of the planet.”

Danielle Smith, Canadian Energy Centre pushing for B.C. LNG expansion

Speaking at the panel, Richard Wong, director of regulatory and operations for the Canadian Association of Petroleum Producers, said B.C. is on the cusp of becoming “one of the most important energy export hubs in the world.” 

He pointed to increased LNG demand in Europe as a strategic opportunity for B.C. As the LNG Canada and Coastal GasLink pipeline projects near completion and B.C. becomes a global energy hub, it presents “a major opportunity for us on the upstream side to grow natural gas production in the northeast part of the province,” Wong said.

But unless the industry meets the standards that British Columbians expect, its future will be limited and benefits won’t be realized, Wong continued. “And so it’s for this reason that we’re really seeking to work with Indigenous communities and the B.C. government to put in place a sustainable framework to promote and attract investments . . . [to] improve the systems and the methods and the practices associated with developing B.C.’s resources, both for local but also for global benefit.”

B.C.’s LNG possibilities have featured prominently on the website of the panel’s sponsor, the Alberta war room. One LNG project featured on the energy war room website is the proposed Cedar LNG project, a partnership between the Haisla Nation and Calgary-based Pembina Pipelines. 

The Canadian Energy Centre has produced a series of articles and a graphic promoting the $3 billion floating liquefied natural gas project near Kitimat. In November, the energy centre published a report about the role of Canadian LNG in Asia, highlighting how projects like Cedar LNG can help meet growing short-term demand in the region. Critics say there are no guarantees LNG will replace coal as a power source and that boosting supply could delay urgently needed transitions to renewable energy.

The B.C. government is set to make a decision any day about whether to greenlight Cedar LNG, whose carbon emissions are not included in B.C.’s climate action plan. 

“I think it would be fair for Premier Eby to push back a little against the war room, and what [Alberta Premier] Danielle Smith is doing and ask her to keep out of those decisions, because they’re for British Columbians to make,” Sven Biggs, Canadian oil and gas programs director for the non-profit group Stand.earth, said in an interview.  

Cedar LNG says the project will produce 168,000 to 840,000 tonnes of carbon emissions per year — roughly the equivalent of putting 36,000 to 182,000 passenger vehicles on the road annually — depending on how much electricity is available for operations.That’s before the upstream climate impacts of natural gas extraction from fracking — including the release of methane, a potent greenhouse gas — are considered. In comparison, in its first phase, LNG Canada will produce about four megatonnes of emissions annually — the equivalent of putting more than 800,000 cars on the road for a year. 

The energy centre is also promoting the $10 billion Ksi Lisims LNG project, a proposal by the Nisga’a Nation and its partners to build a floating LNG terminal about two kilometres from the Alaska border. In December, the project received a 40-year export licence from the Canada Energy Regulator. 

On its website, the energy centre says the Ksi Lisims LNG project, which would require provincial and federal approvals, will use “low-carbon Canadian natural gas” — a phrase Harrison said is consistent with the oil and gas industry’s desire to promote so-called “natural” gas as a climate-friendly energy source and deflect attention from the majority of emissions that occur at the point of consumption. The International Energy Association and Intergovernmental Panel on Climate Change “continue to tell us that we need to significantly reduce consumption of gas, as well as oil and coal, to meet the goals of the Paris Agreement,” Harrison pointed out. 

Premier Smith has begun to tout LNG in her talking points about Canada’s energy sector. And in December, Smith wrote a letter to Prime Minister Justin Trudeau, suggesting Alberta become a “key contributor” to Japan’s efforts to diversify its LNG supply. 

The only two LNG export projects approved in B.C. — LNG Canada and Woodfibre LNG in Squamish, owned by Enbridge and Indonesian billionaire Sukanto Tanoto — will export fracked gas from B.C.’s northeast to Japan and other Asian countries. The gas will be cooled to -162 C — about 1/600 of its previous volume — and shipped in tankers as long as two football fields. 

Fracked gas from Alberta would have to be shipped to B.C.’s coast and liquefied there. Emissions from the portion of the pipeline in B.C. and the liquefaction terminal would be added to B.C.’s inventory. 

B.C. Green Party leader Sonia Furstenau said her chief concern about the energy war room’s push to expand B.C. LNG is centered around good governance and democracy. Citizens need to know governments haven’t been captured by vested interests, Furstenau said.

“It is quite alarming to see a body funded by a provincial government to be so openly a champion for an industry that the government ultimately has the responsibility of regulating,” Furstenau said. “One wonders, where is the public interest in this?’’

“When you have something like this Alberta war room and you have dissemination of very pro oil and gas information, that seems to me like an indication of governments not keeping the proper regulatory relationship with these industries.”

Furstenau said the B.C. government needs to demonstrate it hasn’t forgotten its critical role in regulating the oil and gas industry and ability to make decisions that are first and foremost in the public interest. “We have to, one, stop emitting as much greenhouse gas emissions and, two, start preserving the systems that can help us to absorb them like old-growth forests in B.C. In B.C., we are moving in the wrong direction,” she said. 

B.C. LNG carbon pollution throws off provincial climate targets

Even without the addition of Cedar LNG and the second phase of the LNG Canada project, B.C. is struggling to accommodate emissions from Woodfibre LNG and the first phase of the LNG Canada project in its climate targets.

In November, the B.C. government said it would miss the province’s overall 2025 emissions target by 15 per cent and the 2030 target by three per cent. Environment groups have long questioned the province’s climate plan modelling, which includes as-yet unproven carbon capture and storage projects, calling it overly optimistic. 

Despite a new report showing the high cost of LNG terminals and pipelines puts Canadian LNG projects at a competitive disadvantage, LNG Canada CEO Jason Klein recently said the consortium is planning to build Phase 2, pending a final investment decision.

Phase 2 was approved by the B.C. NDP government in 2018, with LNG Canada saying it would only proceed if market conditions warranted. The second phase is not included in B.C.’s climate action plan, which aims to put the province on a path to achieve net-zero emissions by 2050 while building a low carbon economy. 

Klein said the second phase — like the first phase — would have to rely on gas turbines to liquify natural gas. That would double greenhouse gas emissions from the terminal and make it impossible for B.C. to meet its 2030 climate target. Running at full capacity, the LNG Canada operation would produce around 13 megatonnes of emissions annually, more than 20 per cent of B.C.’s total emissions in 2020. 

Klein’s comments were widely interpreted as an attempt to convince the B.C. and federal governments to pay hundreds of millions for new hydro lines and other infrastructure. The B.C. government has already discounted electricity for the LNG industry from publicly funded hydro projects, including future power from the Site C dam.

Such measures would lower carbon emissions but compel taxpayers and ratepayers to support a project owned by some of the most profitable multinational corporations in the world. Shell, LNG Canada’s biggest shareholder, earned record profits in 2022, posting a $9.49 billion profit in its third quarter, more than double what it took in the year before.

“Extra pressure from outside the province to subsidize that project, which is what I believe Shell and the other backers of it are looking for, is definitely interfering in British Columbia politics,” Biggs commented. 

“In an era where companies like Shell are reporting record profits, it’s clear that if they wanted to implement this technology, they could,” Biggs said. “They’re choosing not to, or holding British Columbians hostage, to demand that we pay for it because it’s in their financial best interest. … This is the wrong time for them to be coming with their handout looking for free money to make this project go ahead.”

LNG Canada has already received at least $5.34 billion in subsidies from the B.C. government in the form of financial breaks and incentives, including tax exemptions, tax reprieves and cheaper electricity rates.

The federal government, despite repeated promises to end fossil fuel subsidies, chipped in $220 million so LNG Canada could purchase energy-efficient gas turbines for phase one and another $55 million to replace a Kitimat bridge to accommodate increased traffic from the project. 

Harrison said there may be a narrow window for Phase 2 of the LNG Canada project to be financially viable — “probably one [in which] the business case rests on financial support from federal and provincial governments.”

In an op-ed for the Vancouver Province, Harrison and climate policy advisor Karen Tam Wu said LNG Canada is bullying provincial and federal governments into a “Sophie’s Choice”: “Subsidize our emissions reductions, or we’ll blow up B.C.’s climate targets.”

Harrison said the war room may be searching for new markets for Alberta gas in preparation for lower gas exports to the U.S. as a result of the Biden administration’s commitment to reduce fossil fuel consumption, including by replacing gas and oil heating with electric heat pumps.

“As such, the Alberta gas industry may be looking to the future and the possibility of exporting its production from the coast in the form of LNG.” 

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Oil and gas producers were in dire straits in the spring of 2020.

Oil prices plummeted as hundreds of millions of people around the world stayed home, reducing demand for fuel, while oil from Saudi Arabia and Russia flooded the market.

In Alberta, oil and gas lobbyists sprung into action, warning government officials the industry could barely cover operating costs. Companies needed financing and government help to keep people employed, they argued, and to provide shelter from the twin crises of COVID-19 and an oil market crash. 

But correspondence and meeting records obtained by The Narwhal have revealed the lobbying went far beyond surviving the pandemic and included what one former government official described as a long-standing oilpatch industry “wish list.”

The records, including dozens of pages the Alberta government initially refused to release, in violation of a provincial information law, reveal details of the long list of changes proposed by the lobby group, the Canadian Association of Petroleum Producers. 

An analysis by The Narwhal has revealed four key areas the oil lobbyists discussed — wetlands, oilsands monitoring, tailings ponds and public involvement — could also be found in earlier lobbying efforts that took place far before the COVID-19 pandemic began. 

Eric Denhoff, who acted as a deputy minister of Alberta’s Environment Ministry under the previous NDP government, reviewed the lobbyists’ list upon The Narwhal’s request. 

“When you look at the enormous volume of requests, what you really have there is a 20-year wish list of requests that they’ve been trying on the [Progressive] Conservatives, then the NDP and then the UCP governments over the last couple of decades,” Denhoff said.

“Many of these go back a long way, and they’ve been pushed back on — both by conservative and NDP governments — because they were inappropriate to try and let industry wriggle out of basic, core responsibilities.”

Jan Gorski, director of the Pembina Institute’s oil and gas program, called the scale and scope of the requests “alarming.” 

Gorski said it appeared that during the pandemic, oil lobbyists “sought the removal of a critical number of environmental protections which were unjustified and would have had long-term negative consequences to Albertans and our environment.”

Industry-led committee pushed to suspend ‘non-essential’ environmental monitoring

Alberta officials discussed the changes behind closed doors, through a committee the oil and gas lobby group dubbed the “COVID-19 Market Crisis Joint Working Group,” the documents obtained by The Narwhal show. The lobby group initiated the committee on March 18, 2020, one day before Alberta saw its first death from COVID-19, under an agreement with then-premier Jason Kenney and then-energy minister Sonya Savage, herself a former Enbridge lobbyist.

Then-president of the Canadian Association of Petroleum Producers, Tim McMillan, a former Saskatchewan energy minister, called the first meeting to order two weeks later, and Savage and McMillan ran through the group’s “objectives.” Some senior staff in the minister and premier’s offices were also listed as “required attendees.” 

The lobby group presented a list of 132 separate items to officials during the first meetings of the committee — asking to suspend, defer or scale back industry obligations on everything from Indigenous consultation to greenhouse gas reporting and environmental or wildlife monitoring programs. In their internal emails, some government officials began referring to the lobbyist list by a nickname, using the lobby group’s acronym: “CAPP 132.”

The oil and gas lobbyists outlined their requests to officials, including their desire to postpone the development of any policy or regulation that would “increase costs” for industry and instead “focus on industry priority areas to mitigate potential for increased burden for industry.”

They also were interested in “leveraging” some of their previous lobbying efforts, they said, and in suspending what the lobbyists called “near-term, low-risk regulatory obligations,” like the provincial policy for protecting wetlands, as well as suspending requirements under the province’s emissions reduction and methane restrictions programs.

Although there is nothing unusual about lobbyists for Alberta’s largest industry pressing government officials about policy decisions or asking government to consult companies about matters that could directly affect them, the documents provide a glimpse into how oil and gas companies had an influential — and unparalleled — seat at the table.

Oil and gas committee structure ‘unbelievable’: former Alberta deputy minister

Nearly 50 public servants, political staff and regulators were involved with planning or running the committee or its various sub-committees — which also discussed additional policy changes. The structure of the main committee, including its name, is similar to a federal undertaking with the same lobby group reported on by The Breach.

The committee at the federal level was led by Natural Resources Canada, The Breach reported, and chaired by then-minister Seamus O’Regan, who is now labour minister. It had a similar objective of reducing “regulatory burden,” and included a short list of oil and gas company representatives. 

In addition to lobbyists and government officials, the Alberta committee also involved representatives from five oil and gas companies: Tourmaline Oil, NuVista Energy, Canadian Natural Resources Limited, Imperial Oil and Syncrude. None of these companies responded to The Narwhal’s requests for comment.

Alberta Energy’s top bureaucrat, Grant Sprague, moderated the committee meetings. The Narwhal reached out to Sprague for an interview but did not receive a response from him or Alberta Energy. Alberta’s Environment Ministry, Alberta Premier Danielle Smith, the office of former premier Kenney (contacted by The Narwhal before Smith was sworn in) and the office of Savage, who is now environment minister, all did not respond to requests for comment.

The committee’s “core operational team,” according to the documents, was listed as three vice presidents from the oil and gas lobby group, as well as an “industry designate” from one of the other oil and gas companies. It also included a senior official in Savage’s office and one other “government designate.” 

Denhoff, the former deputy minister, had reservations not just about the list of requests, but the structure of the committee.  

“The entire core operations committee is four lobbyists and a political chief of staff,” he said. “It’s just unbelievable.”

CAPP says it ‘helped to create a safer environment’ for workers

In one internal presentation to provincial officials from April 2020, the lobby group noted how the provincial government had estimated the industry was running out of cash and needed between $25 billion to $30 billion to continue operating, more than the entire budget of the Ministry of Health in Alberta at the time (which was just under $21 billion in 2020).

It was in these circumstances that lobbyists circulated their list of 132 requests. Alberta granted approximately half of the requests by June 2020, the documents show, while dozens of others were either partially approved or remained under discussion. Some of those decisions led to the temporary rollback of environmental oversight in the province. 

Those rollbacks included ministerial orders modifying legislation overseeing environmental protections and oil and gas activity and numerous amendments to approvals governing the monitoring of the oilsands. 

In response to written questions from The Narwhal, Jay Averill, a spokesperson for the Canadian Association of Petroleum Producers, sent a brief statement. “Through the COVID-19 pandemic and resulting global economic shutdown, the Canadian Association of Petroleum Producers, on behalf of the oil and natural gas industry, worked directly with provincial and federal governments to ensure reliability of energy production as an essential service,” he said.

“By working in concert with policymakers across the country we helped to create a safer environment for the people working in the industry while they continued to provide the energy Canadians and our trading partners rely on to survive.”

Alberta wetland protections mean ‘significant costs’ for oil companies: CAPP

One of the key focus areas for lobbyists pressuring provincial officials at the onset of the COVID-19 pandemic was wetland policy as it relates to industry.

The Canadian Association of Petroleum Producers has long pushed back against rules it views as too stringent, or too expensive, when it comes to protecting wetlands, starting with Alberta’s wetland policy introduced in 2013. Such a policy provides “strategic direction” for decisions impacting wetlands in the province, including tools and guidelines for development.

Wetlands cover about half of the oilsands region, according to the Alberta government,  and include bogs, marshes and peatlands, which develop over hundreds of years and are deeply important to First Nations communities.

When Alberta’s wetland policy was introduced in 2013, the association pushed back against a proposed “no-net-loss” clause in the policy that would have forced the industry to replace each hectare of wetland it damaged. The group complained such a policy would cost companies “billions of dollars.” The government backtracked, ultimately announcing a policy that aimed only to “minimize the loss” of wetlands, while emphasizing it would still “allow for continued growth and economic development.”

Nevertheless, the industry continued its resistance into 2019, when it pressured the government over Alberta’s “wetland policy implementation approach,” as part of 52 “energy issues” identified in the documents as being oil and gas lobby group priorities. 

By the time the pandemic struck, the industry was again pointing to the cost of minimizing damage to wetlands, saying “wetland policy implementation incurs significant costs for operators,” and asking for temporary elimination of wetland-related requirements.

Documents show the Canadian Association of Petroleum Producers wanted the Alberta Energy Regulator to “defer any required three-year comprehensive reporting requirements for wetlands by one year,” and to “waive the requirement to collect wetland monitoring samples for the duration of, and three months following, [COVID-19] distancing requirements.”

The association also asked the regulator to waive all requirements for field monitoring and reporting under the province’s Environmental Protection and Enhancement Act for all of 2020 — programs that “may include” those related to wetlands, the lobbyists said — as well as surface water, fisheries, soil, wildlife and reclamation.  

The lobbyists said monitoring programs relied on third-party contractors, who were difficult to bring into work sites at the time because operations were limiting staff to essential workers only, and COVID-19 travel restrictions were also in place. 

They also downplayed the risks of temporarily eliminating monitoring. 

“For wetland monitoring, suspending sampling for a season or a period of time is unlikely to result in a potential impact being missed,” they said in their request. “Delay will not impact wetlands, only reporting,” they said in another. 

The province ended up granting all three of those requests.

In response to questions, the provincial energy regulator told The Narwhal by email “only some monitoring and reporting requirements” were temporarily suspended through ministerial orders — those “considered to have a low risk of potential short- and long-term impacts.”

All requirements for monitoring, and activities incidental to monitoring, that had been suspended were reinstated in the summer of 2020, a spokesperson said.

The Narwhal also asked the regulator what happened to approved environmental suspensions with vague end dates, such as “three months post-COVID-19” or other similar references to the end of the pandemic. 

The regulator said oil and gas operators were given 30 days following the regulator’s amendments to various decisions issued June 22, 2020, “to comply with all existing approval requirements as of July 15.”

‘Unfettered access’ for industry: critic 

Like the wetland policy, the joint Oilsands Monitoring Program with the federal government was started about a decade ago, and it received pushback in Alberta almost from the start. Yet the program, which oversees environmental monitoring of the oilsands region except for leases controlled by companies, has released valuable information showing rising mercury levels downstream from oilsands plants. 

According to the program’s most recent annual report, published in 2019, its research had become the basis for hundreds of peer-reviewed papers and other reports and presentations on issues including air quality, mercury, carbon pollution and the impacts of wildfires.

The oil and gas industry, which pays for the program, has been lobbying about it since at least 2019. Government records show that at that point the province was indicating a “limited” desire to engage on the topic. 

But after the pandemic began, the lobbyists argued to Alberta public servants that oilsands companies shouldn’t have to pay for the monitoring program that year, in part because various environmental monitoring activities would be suspended due to COVID-19 restrictions and the program’s expenses would shrink.

They also argued the program had “consistently underspent” its annual budget “over the past several years,” and so a “significant surplus has accumulated.” These surplus funds, it said, should be used to pay for the program for 2020-21, instead of oilsands companies. The lobbyists also asked for the program’s focus that year to be on desk work like program design, data analysis and report writing. 

The government marked this request as “reposition,” meaning they did not immediately grant it, but continued discussing it. 

Denhoff, the former deputy climate minister, said the monitoring program became a “battle.” Every year, he said, industry would try to reduce the amount of money the program spent — ensuring there would be a surplus.

In their request, the lobbyists did not specify how much of a surplus had accumulated. In 2020, The Canadian Press reported the program’s budget in 2019-20 was $58 million, of which approximately 90 per cent was spent. 

Joe Vipond, a physician who is past president of the Canadian Association of Physicians for the Environment and co-founder of the Calgary Climate Hub, said the documents show how weakened oilsands monitoring was another point against the provincial and federal governments’ claim the initiative is a “world-class monitoring system.” 

“It’s no surprise that as soon as there’s trouble in the industry, the first thing they want to do is make that monitoring even weaker,” he said. 

“Everything that has happened since the UCP has come into power has been about supporting the industry. And so it’s zero surprise to me that industry has this kind of unfettered access, whereas it’s very difficult for other citizens, including environmental organizations, to have influence over this government.”

Cutting oilsands tailings pond management ‘does not impact safety’: CAPP

In addition to the Oilsands Monitoring Program, lobbyists were also fighting obligations to monitor the industry’s own waste.

The gigantic reservoirs of toxic byproducts created by oilsands operations, known as tailings ponds, have ballooned in size by almost 800 per cent over the past half-century and are now collectively bigger than the city of Vancouver. 

The oil and gas industry has been pushing to release treated water from these tailings ponds into the Athabasca River, a move critics say could risk damaging the important waterway. Federal regulations on the issue are expected in 2025. 

Related to tailings ponds are what the industry calls “pit lakes,” which are reclaimed oilsands areas filled with a mix of mine water, fresh water and tailings.

Tailings ponds in Alberta have been found to be leaking and there remains no comprehensive plan to clean them up, nor any clear indication of how this would be paid for. According to the regulator, companies have set aside $1.5 billion for security as of June 2022 to cover what the regulator has said is nearly $34 billion in liabilities related to the clean up of mining sites, including the oilsands. In 2018, a senior official at the Alberta Energy Regulator said in an internal presentation the true figure could be much higher.

The industry was lobbying on policies relating to pit lakes and tailings in 2019, according to the documents. Once the pandemic began, the oil and gas lobby group asked again for a reprieve on collecting samples. 

“There is only one contractor that can do this work,” the lobbyists told the government, “and operators already struggle to get this done as an industry because of capacity.” 

They said that instead of sampling, the data could be “estimated” instead based on the volumes of material being treated. 

Again, the oil lobbyists played down the danger of stopping monitoring. 

“[Tailings] pond measurement in itself does not impact safety nor increase environmental risk,” they wrote in the 132 requests. “While having annual pond investigations done does provide useful data, given the current environment it makes sense to provide a one-year-only waiver from the requirement to collect new data.”

The government granted this request. 

Government documents show that as early as May 2020, the crisis committee was “evaluating” changes to the tailings policy. 

Records show the oil lobbyists also successfully pressured the government to “waive the requirement for water quality monitoring for the duration of the COVID-19 crisis,” which included pit lakes, as well as groundwater, surface water and other water quality analysis.

Industry also received approval to suspend requirements to “advance research programs and demonstration activities for 2020” including those for pit lakes. 

Public involvement the ‘Achilles heel’ of oil and gas development process

The oil and gas lobby group has long been interested in shrinking the process for public consultations on energy projects, one of the few ways Albertans can have their voices heard on industry activities. 

In 2019, The Narwhal reported on government documents showing how oil lobbyists wanted to “expedite” public consultations involving Albertans and landowners that may be directly and adversely affected by new oil and gas developments like wells or pipelines. 

Normally, these individuals can file a “statement of concern” about the development, typically within a 30-day period, but the oil and gas industry has referred to this process as an “Achilles heel” thwarting approvals of energy projects. It has lobbied to either shrink or cut this process in some instances, which could limit the ability of Albertans to object to oil and gas activities that affect them, or limit which projects were required to seek public input. 

The documents obtained by The Narwhal confirm the lobby group continued to pressure the government on the statement of concern process in 2019. 

The issue also became a significant lobbying point during the COVID-19 crisis response committee meetings. 

“Statement of concern process opportunities” appears as a discussion topic five times during meetings between August and October 2020, the documents show.

The oil and gas lobby group initially informed the Alberta government at the start of the crisis response committee that they were interested in “leveraging previous [Canadian Association of Petroleum Producers] submissions,” one of which was managing statements of concern, which it called a “top priority.”

‘Major step backwards’ for province to privately meet with industry about Indigenous consultation

Consultation with Indigenous communities is required as part of the approval process for new oil and gas projects.

However, there were no First Nations representatives listed on any of the committees discussing the rule changes with provincial and industry officials — including proposed changes to project reviews through the regulator.

The government also agreed to another request the lobbyists made regarding the Aboriginal Consultation Office, a government agency that coordinates input from First Nations and Métis communities potentially impacted by oil and gas projects: to ensure Indigenous consultations about oil and gas projects wouldn’t be “paused or delayed due to an inability to meet in person.”

The government granted this request in early April 2020. In mid-April that year, the Aboriginal Consultation Office started sending out messages to about 30 First Nations telling them consultations would resume so oil and gas projects could move forward, according to Global News.

No representative from Alberta Indigenous Relations was listed as attending the crisis committee. The ministry did not respond to questions from The Narwhal.

“The history between the Alberta government and Indigenous nations is one already marked with strife and mistrust due to past and ongoing violations of the Alberta government with Indigenous communities,” said Melina Laboucan-Massimo, co-founder and campaigns director at Indigenous Climate Action and founder of Sacred Earth Solar.

“Alberta publicly pretending to attempt reconciliation with Indigenous nations while secretly meeting with industry is a major step backwards from any meaningful reconciliatory action by once again disrespecting the inherent and treaty rights of Indigenous peoples,” Laboucan-Massimo, who is Lubicon Cree from northern Alberta, said.

‘Troubling’ lack of transparency at Alberta Energy

Government officials and industry lobbyists did not make public the nature of their conversations at the crisis committee. The government only released some of the details in September after it was compelled to do so through freedom of information legislation. 

Alberta’s freedom of information legislation requires government agencies to grant access to records within 30 days upon request, unless they have a valid reason to refuse or delay. In this case, the ministry’s failure to meet deadlines prompted a rebuke from the watchdog, the Office of the Information and Privacy Commissioner of Alberta, who confirmed earlier this year that Alberta Energy was in breach of the law for refusing access to records. Alberta Energy eventually released those records to The Narwhal in September, more than a year past the deadline.

Alberta Energy has also missed another deadline in response to a separate request for records from meetings of government officials and lobbyists on the committee after the fall of 2020. The ministry told The Narwhal its freedom of information office was “short-staffed.”

Vanessa Sung, interim executive director for Evidence for Democracy, an Ottawa-based nonprofit that promotes evidence in government decision-making, said this raises concerns about transparency.

“A healthy democracy is one where citizens are informed and able to engage in the process of policy development or, at minimum, understand the rationale behind policy decisions. This is how we hold policymakers accountable for their decisions and it requires transparency at all levels of government,” Sung said.

“As a country we’re in need of improvement around policy transparency, and this committee is a very troubling example of that,” she said. 

“In a democracy, it’s not enough that governments say they are making decisions that benefit their citizens. They need to show their work.”

Regulator says it is ‘committed to working with all its stakeholders’

Vipond, the physician, said the government documents appeared to show “unilateral conversations” between oil and gas lobbyists, public servants and regulators, without input from other groups. 

Vipond pointed to the rise of videoconferencing at the onset of the pandemic as yet another way the government could have engaged other Albertans. “There’s no reason why other stakeholders couldn’t have been involved,” he said.

A spokesperson for the Alberta Energy Regulator said it was “committed to working with all its stakeholders and this engagement happens at all levels of the organization.”

“Our leadership is committed to developing these relationships and meets with different groups and individuals over the course of a year on a variety of topics consistent with anyone in a leadership role,” the spokesperson said. 

“Additionally, our leadership continues to connect with a variety of stakeholder groups, including industry, environmental non-government organizations, municipal associations and Indigenous communities to further build these relationships.”

The spokesperson also said the crisis committee was formed to “develop a timely response to ministerial orders related to COVID-19 and protect the safety of workers in the energy industry and Alberta communities.”

Vipond is concerned more Albertans weren’t involved.

“Theoretically, governments work for all people within that jurisdiction. So where’s the Indigenous consultation? Where’s the citizens, where’s the environmental organizations, where’s the counters to one perspective?” Vipond asked.

“If you’re only getting one perspective, you’re probably only making one decision.”

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The relationship between governments and the fossil fuel industry in Canada is under the spotlight again after a high-profile staffer jumped straight from the Alberta premier’s office to one of the country’s most powerful oil and gas companies.

Critics say the move by Brock Harrison to TC Energy — the company behind the Coastal GasLink pipeline and one of the firms that pressured RCMP to enforce an injunction on Wet’suwet’en territory — is the latest example of a “revolving door” culture between government and industry, one that is threatening climate progress.

Harrison had been the executive director of communications and planning for former Alberta premier Jason Kenney since late 2020. On a Thursday in late September, he posted a statement to Twitter saying he was leaving Kenney’s office. The following Monday, he announced he would be starting as TC Energy’s manager of government relations covering Alberta, Saskatchewan and Manitoba.

“Looking forward to an entirely new challenge at a great Alberta company,” he wrote on LinkedIn.

Before he worked in Kenney’s office, Harrison was executive director of Kenney’s United Conservative Party caucus and chief of staff to the minister of Children’s Services. He also worked as director of communications for former federal Conservative Party leader Andrew Scheer, and was once communications director for the Wildrose Party, one of the parties that merged to form the United Conservative Party, which new Alberta Premier Danielle Smith once led.

He also worked as a journalist from 2005 to 2008 with the Edmonton Journal and the Kingston Whig-Standard.

Now, Harrison will be stepping into a job focused on securing the support of provincial government officials on behalf of a large, influential oil and gas company. TC Energy has already forged close ties with the United Conservative Party government — in particular through the government’s multibillion-dollar backing of one of the company’s former signature pipeline projects, Keystone XL, which would have expanded Canadian crude oil exports to the United States.

“Harrison has deep connections with conservative parties in Canada,” David Gray-Donald, oil and gas program manager at Environmental Defence, told The Narwhal. “And that will, no doubt, be of great benefit to TC Energy.”

It is not clear when TC Energy began talking to Harrison about the new job opportunity.

Harrison did not respond to questions from The Narwhal sent on LinkedIn. TC Energy said it would not comment on the matter “for privacy reasons,” and sent a general statement to The Narwhal.

“We abide by all rules and regulations in the jurisdictions in which we operate across North America,” a company spokesperson wrote in an emailed response to questions.

Staffer was in Kenney’s office when TC Energy lobbied for ‘government assistance’

In 2020, with Kenney’s full support, TC Energy entwined itself in a complex Keystone XL investment with the Alberta Petroleum Marketing Commission, a provincial Crown corporation. The deal, which involved multiple numbered companies and an opaque management structure, made it possible for Alberta to commit up to $7.5 billion to support the pipeline project.

Harrison was working for Kenney as TC Energy was lobbying the premier’s office for “government assistance” on the project, lobbying disclosure filings show.

After U.S. President Joe Biden revoked the pipeline’s permit, leaving the province on the hook for $1.3 billion, Kenney’s energy minister launched a trade challenge, during which lawyers for the Crown corporation used the investment deal with TC Energy as part of their legal argument.

The company’s latest lobbying filing, dated mid-October, shows it continued to lobby Kenney’s office over the summer and fall of 2022 to discuss winding down the pipeline project.

During this time, it was also lobbying the premier’s office on “maintaining and growing market access for Alberta and North American gas production,” as well as on the province’s electricity market including the planned coal power phase-out, the filing shows.

Harrison was “working right alongside politicians, getting those relationships and expertise,” Gray-Donald said.

“We see this in how the oil and gas industry has worked in Canada — having very close relationships with both politicians and government officials, having strong presence at all levels of government and the political apparatus.”

When Harrison worked for Scheer, he was lobbied by the now-defunct Canadian Energy Pipeline Association, which counted TC Energy as a member.

Having close, existing connections with people in government helps lobbyists create long-term relationships with decision makers, Gray-Donald said, adding these relationships help influence politicians’ and bureaucrats’ perceptions of an issue, and can crowd out competing perspectives.

Lobbying is often used to achieve narrow outcomes for a corporation, like obtaining market access for its products or getting out of a regulatory requirement it considers too costly or time consuming, according to a 2019 report by the B.C. and Saskatchewan offices of the Canadian Centre for Policy Alternatives and the Corporate Mapping Project.

Lobbyists achieve this by ingratiating themselves with decision makers, ultimately becoming seen as “reliable allies” whose expertise is trusted and whose viewpoints come to mind “more quickly than others when it comes time to construct policy or make a decision,” the report concluded.

When it comes to the oil and gas industry, these perspectives sometimes take the shape of climate denial or delay, convincing governments to approve infrastructure that can lock-in a dependence on fossil fuels as the need to decrease carbon pollution becomes more urgent.

“This is the activity that oil and gas companies are trying to do — they’re trying to push their narrative, their reading of information, to get what they want from politicians,” Gray-Donald said. “And it has an effect of drowning out other information, other perspectives, other policy demands.”

Going forward, the TC Energy team has registered over three dozen staff members to lobby 14 separate provincial ministries and other entities — including the premier’s office — on everything from market access for pipelines and natural gas to Indigenous relations, nuclear and hydrogen power, electricity transmission and environmental permitting.

None of this lobbying activity is unusual for a major corporation and there is no evidence suggesting the company is breaking any rules.

Ethics commissioner ‘does not give or deny’ employment permission for former officials

Alberta’s conflict of interest legislation contains a number of restrictions on former members of a premier’s and ministers’ staff for a period of 12 months after their employment ends. These include limitations on lobbying public office holders or acting “on a commercial basis” on matters on which they previously “directly acted.”

Nothing about Harrison accepting his new job necessarily means he has violated any of those rules. Even if his job description did list duties that could contravene the post-employment provisions of the law, he would have to actually carry out those duties to be in violation, according to the provincial ethics commissioner’s office.

The office of the ethics commissioner would not say if Harrison asked for advice on whether he would be in violation of the rules if he accepted the position. The office “is not allowed to comment on individual cases,” chief administrative officer Kent Ziegler wrote in an emailed response to questions.

“The ethics commissioner does not give or deny anyone, subject to post-employment restrictions, permission to take new employment,” Ziegler wrote.

“In some instances, employers will modify the position requirements so a breach of the post-employment restrictions will not occur. In those cases, a letter so stating is usually requested by the commissioner,” he added.

“Even if the commissioner gives an opinion about particular employment, the person subject to the restrictions still remains subject to them for the year.”

Former members of the premier’s staff who violate the post-employment restrictions in the conflict of interest law can be fined up to $50,000 and could be held liable for restitution if they profited from a transaction related to the position, according to the legislation.

‘Revolving door’ between Alberta government, oil and gas industry

Ian Hussey, a research manager at the University of Alberta’s Parkland Institute, which studies political and cultural issues in the province, said Harrison’s hiring “is the latest incident in the long history of a revolving door between the Government of Alberta and oil and gas companies.”

This revolving door, he said, “is one example of the corporate power that stands in the way of urgent action needed to adapt to and mitigate the increasing effects of climate change.”

He added the United Conservative Party, now headed by Smith, should make efforts to hire staff with diverse employment backgrounds. That, he said, would put the government in a better position to regulate the oil and gas industry and ensure it cuts carbon pollution and cleans up environmental liabilities.

Smith’s office did not respond to questions about Harrison from The Narwhal.

Harrison is not the first high-profile political staffer or politician to end up in the oil and gas sector. In 2013, former Alberta environment ministry spokesperson Mark Cooper left a Progressive Conservative government to work as communications manager for the Canadian Association of Petroleum Producers, Canada’s largest oil and gas lobby group. Cooper later moved over to a communications role with TC Energy, then known as TransCanada. Prior to that, Cooper had also briefly worked for former Conservative federal environment minister Rona Ambrose in 2006.

And the issue is not limited to Alberta — former Saskatchewan premier Brad Wall, for instance, is now a director at Whitecap Resources, an oil and gas firm. In 2015, a private meeting in Montreal between federal energy regulators and former Quebec premier Jean Charest, on contract at the time as a consultant for TC Energy, would trigger a series of events that led to the downfall of TransCanada’s Energy East pipeline project.

The apparent revolving door between politics and the oil and gas industry is also not limited to conservative parties. In British Columbia, B.C. Greens leader Sonia Furstenau recently accused the B.C. NDP of becoming too close with fossil fuel lobbyists.

Her comments came on the heels of the party’s decision to disqualify leadership contender and climate activist Anjali Appadurai, leaving David Eby to be acclaimed as the new leader.

Furstenau’s examples included Michael Gardiner, the NDP’s former provincial director, who has lobbied on behalf of Tourmaline Oil, a large natural gas producer, and Pembina Pipeline, which operates tens of thousands of kilometres of pipelines carrying oil and gas, according to the B.C. lobbying registry.

Stephen Howard, a former chief of staff to former party leader Adrian Dix, has also lobbied for Tourmaline Oil according to the registry. Both fossil fuel companies have argued against financial transparency measures that would show how climate change could disrupt their businesses.

Furstenau questioned whether these and other ties undermined the trust the public had placed in the government to act in their best interests.

B.C. NDP’s chief electoral officer denies Green Party’s fossil fuel lobbying accusation

Gardiner and Howard did not immediately respond to questions sent from The Narwhal. There is no evidence either of them broke any rules.

The B.C. Greens leader also claimed that Elizabeth Cull, the B.C. NDP’s chief electoral officer who wrote an internal report that led to Appadurai’s disqualification, “is herself a former fossil fuel lobbyist.”

Reached by telephone, Cull strongly denied this.

Cull, a former provincial cabinet minister and chief of staff to an NDP premier, was working for Hill & Knowlton Strategies in 2018 when she registered to lobby for the Resource Benefits Alliance, an association of local governments in the province’s northwest.

The alliance has endorsed LNG Canada, a multibillion-dollar natural gas project in the region, but Cull said that was not the work she was doing for the organization.

She said she was working on building a case for the municipalities to demand more of their fair share of revenues from a range of industries, such as logging and aluminum smelting.

“I take offense to being called an oil and gas lobbyist when I absolutely refuse to work for oil and gas companies, or other companies that I don’t think have the best interests of our province at heart,” she said.

“The main thing that I helped them do was put together a presentation, which said that they deserve to have a share of existing resource revenue, and new resource revenue. So to say that I’m lobbying for the oil and gas industry implies that I’m working for them [the industry], when in fact, I don’t, I wouldn’t ever.”

Cull said if the main reason the alliance had hired her would have been to support LNG Canada, “I wouldn’t have worked for them.” When she joined Hill & Knowlton, she said, she had laid out some ground rules, which included not working “for certain kinds of companies.”

B.C. NDP government defends its record on lobbying reform

The Narwhal asked the B.C. NDP to respond to accusations the party’s relationship with oil and gas lobbyists had become too close to effectively represent the public interest.

The province introduced “sweeping reform to increase transparency and accountability in lobbying,” a spokesperson for the Ministry of Attorney General said by email.

The 2020 amendments to the Lobbyist Transparency Act “aim to enhance public confidence that government officials are acting in the best interest of the people of B.C. not on behalf of big corporations or organizations,” the spokesperson added.

“The changes increase the lobbying information available to the public through the free online lobbyist registry to include details such as who will benefit directly from the lobbying effort, disclosure of third-party interests, the existence of reportable political contributions, if there are contingency fees and if the lobbyist adheres to a relevant code of conduct.”

Eby was B.C.’s attorney general when these changes were adopted.

Climate crisis should take precedent: researcher

Overall, political watchers like Hussey are not surprised by what they see as the revolving door between oil and gas companies and governments, but they remain concerned by the implications of governments’ ability to make progress on pressing issues, from climate action to ensuring responsibility for cleanup of oil and gas sites.

“We’re in a climate crisis, and we need to develop a plan for how to deal with multiple crises,” Hussey said.

“We can’t look at the same industry that’s creating these liabilities — and not doing enough to clean them up — and continue to hire out of those ranks and expect to get different results.”

The Narwhal’s reporters are telling environment stories you won’t read about anywhere else. Stay in the loop by signing up for our free weekly dose of independent journalism.

The oil and gas industry has a track record of running roughshod over the science of climate change in pursuit of massive profits, while financially backing organizations that spread doubt and misinformation about the dangers of fossil fuels.

What might surprise Canadians, however, is that arguably some of the most consequential examples of climate denial in history happened back in the 1950s and 1960s, long before climate science went mainstream, and involved a key project in Alberta.

The details have been gathered into a forthcoming book by Canadian investigative journalist Geoff Dembicki called The Petroleum Papers: Inside The Far Right Conspiracy To Cover Up Climate Change, due to be published Sept. 20 by Greystone Books.

Dembicki’s book highlights decades of effort by oil companies and the organizations that lobby for them to distract from the environmental destruction their products create by building, in his words, “an edifice of lies,” meant to anticipate and blunt public anger over climate change and its causes.

In an interview, he said the book’s central message is that, far from being a bit player, Canada’s oilsands industry has played a “profound role” in how Americans deal with the climate emergency, due to the enormous amounts of money, time and expertise that U.S. companies have sunk into making high-carbon oilsands projects profitable.

“A lot of the companies that had the biggest financial stakes in the oilsands, such as Exxon, were really key to leading disinformation campaigns in the 1990s and 2000s. That had a huge role in blocking solutions to climate change, when we really could have gotten good control of the emergency,” Dembicki told The Narwhal.

“The point I really want to drive home is that Canada has played a huge, underexplored role in the ability of one of the world’s largest emitters to deal with this problem.”

The birth of Alberta’s oilsands and the first climate warnings to industry

Dembicki’s book takes a close look at Philadelphia-based Sun Oil, a company that would eventually spawn Suncor.

These days, Suncor is one of Canada’s multibillion-dollar oilsands producers, pumping out over 600,000 barrels per day of petroleum products from its oilsands holdings, while producing tens of millions of tonnes of carbon pollution in the process.

Sun Oil had been present in Canada since the 1920s, selling gasoline imported from the United States branded as “Sunoco,” a condensation of SUN Oil COmpany. (After corporate acquisitions, Sunoco-branded gas stations in Canada were converted to Petro-Canada branding, while in the U.S. they are now controlled by a Dallas-based energy firm.)

In 1949, Sun Oil began examining oilsands development and established a division in Calgary, and by 1950 the company had launched a drilling program and acquired “Lease 86,” where Suncor’s current oilsands operation would eventually be located.

Two years later, Sun Oil committed $250 million to create the Great Canadian Oil Sands company, which at the time was the largest single private investment in Canada. In 1967, the company and its subsidiaries would launch the first commercialized heavy oil megaproject in the oilsands, opening the door to exploiting the third largest proven oil reserve in the world.

The project’s success ushered in an era of explosive growth in oil production and carbon pollution in Canada. Federal figures show that between 1990 and 2020, oilsands production jumped more than 725 per cent, while emissions soared by over 430 per cent. As of 2020, the oilsands represented the largest portion of oil and gas emissions in Canada, at 81 million tonnes, a figure that represents more carbon pollution than the economies of B.C. or Quebec.

The Great Canadian Oil Sands plant is now considered a “landmark” by the Alberta government. It calls the company a “pioneer” that slogged through years of operational mishaps, like jammed crushers and frozen conveyor belts, to eventually turn a profit in 1975. Suncor describes its early efforts in Alberta as resulting from “perseverance, dedication and innovation” that proved the skeptics wrong.

But as Dembicki argues, Sun Oil followed through with this massive project in the 1960s even as the firm was exposed to clear scientific warnings about the dangers of unchecked greenhouse gas emissions.

The climate warnings came in two distinct moments. The first was a November 1959 symposium in New York City called Energy and Man, organized by Columbia University and the lobby group the American Petroleum Institute. That event featured “one of the earliest known climate change warnings to the oil and gas industry,” Dembicki wrote.

Speaking at the event was Robert Dunlop, then president of Sun Oil and also a director at the petroleum institute at the time. He promised during his speech to “listen with the keenest attention” to another speaker, Edward Teller, a nuclear weapons physicist.

Teller would inform the influential crowd that burning fuel creates carbon dioxide that ends up in the atmosphere, causing a “greenhouse effect” that is heating up the Earth.

“It has been calculated that a temperature rise corresponding to a 10 per cent increase in carbon dioxide will be sufficient to melt the icecap and submerge New York,” he said.

“All the coastal cities would be covered, and since a considerable percentage of the human race lives in coastal regions, I think that this chemical contamination is more serious than most people tend to believe.”

Dunlop would later argue in 1967 in front of the U.S. Congress, as chair of the petroleum institute, that toxic fumes from internal-combustion engines, like carbon monoxide, nitrous oxide and unburned hydrocarbons would eventually be “controlled.”

Although this prediction would come to pass, as most gas-powered vehicles in the United States began to be fitted with catalytic converters by the mid-1970s to comply with tighter exhaust regulations, the technology doesn’t eliminate emissions of carbon dioxide, the main greenhouse gas.

Dunlop didn’t raise the issue of carbon dioxide in his comments to Congress either. One of Dunlop’s top priorities at the company following the “Energy and Man” conference would be to figure out how to develop Alberta’s oilsands, Dembicki wrote.

As Great Canadian Oil Sands was just starting operations, Dunlop would again be exposed to a clear warning, this time from a report commissioned by the petroleum institute. The group had asked scientists at the Stanford Research Institute to study the link between the oil and gas industry and the Earth’s temperature rise.

Their 1968 report was clear: concentrations of carbon dioxide in the atmosphere were climbing fast, and the only explanation that made scientific sense was that it was the unrelenting burning of fossil fuels. “There seems to be no doubt that the potential damage to our environment could be severe,” they wrote.

The report, excerpts of which are available online, found that carbon emissions were overcoming the natural process of carbon dioxide removal, and that the temperature increase would eventually melt icecaps, leading to sea level rise and consequential environmental damage. They then concluded that research needed to be urgently directed towards technologies to control emissions.

By that time, Sun Oil was already sending oilsands oil down a pipeline from Fort McMurray to a refinery in Sarnia, Ont., and heading into Alberta’s history books as achieving a “certain level of glory.” Suncor itself would officially form in 1979, when the Canadian operations of Sun Oil merged with the Great Canadian Oil Sands company.

The company has made some effort in recent years to soften concerns over its climate impact. It has supported carbon pricing, said it intends to offer more “low- carbon fuels” and promised to cut its emissions and reach “net zero” emissions by 2050, although this pledge doesn’t include the majority of its carbon pollution, which comes from the burning of its products.

Suncor, however, has recently lobbied against climate transparency measures. The company’s former chief executive Mark Little recently stepped down following news reports of a string of worker deaths at company facilities. The death of a 26-year-old contractor near Fort McMurray in July was the fifth such workplace fatality since 2021.

Prosperity in the oilsands has played a huge role in wealth generation for companies in Alberta, as well as the provincial government, and to a certain extent, Albertans themselves. The royalties from bitumen, the tar-like petroleum substance derived from the oilsands, have poured billions of dollars into provincial coffers. The International Energy Agency estimates that over five per cent of workers in Alberta are employed in the oil and gas industry. Many more indirect jobs exist to supply industry needs as well as support the daily activity of industry workers.

At the same time, Sun Oil’s first oilsands megaproject, and a second megaproject that would come in the 1970s, both received significant levels of public funding to help them succeed. And there have been persistent questions about whether the riches generated from the oilsands have been fairly distributed to Albertans.

The Narwhal asked Suncor for its response to the book’s arguments and to comment on the company’s history when it came to heeding the many scientific warnings about climate change, but has not heard back.

The religious connection that greased the oilsands wheels

Dembicki outlines in his book how the wheels for Sun Oil’s oilsands megaproject were greased by the religious worldviews of Dunlop’s predecessor, former Sun Oil president J. Howard Pew, as well as then-Alberta premier Ernest Manning. Both men felt that North American oil needed to be urgently exploited.

The Pew name is associated these days with the Pew Charitable Trusts and the Pew Research Center it established, but in the early 1960s, Pew, a Christian libertarian, was able to get Manning’s approval to get an oilsands operation started in Alberta, after the two exchanged letters riddled with Biblical references.

Dembicki’s book quotes extensive research done by Darren Dochuk, a history professor at the University of Notre Dame, who has studied the links between religion and petroleum in the United States, including in his own book, Anointed With Oil: How Christianity and Crude Made Modern America.

Through archival documents, Dochuk has shown how Pew became bent on using the oil in northern Alberta to loosen North America’s dependence on overseas oil. Pew enthusiastically showed off a file marked “Athabasca Tar Sands” in his Philadelphia office, Dochuk wrote, to anyone who would indulge him.

He talked about “America’s Christian heritage,” and gave rousing speeches on the virtues of “freedom” and “friendly competition.” He railed against the 1930s New Deal package of economic stimulus, unemployment relief and public works projects, calling it a government attempt to dominate the private sector. He defended the right for employers to lower employee wages on a whim.

Manning, meanwhile, held conservative evangelical beliefs and was a radio preacher. He wanted Alberta to generate wealth from its resources, but as a “premillennialist,” Dochuk wrote, he also believed Christ’s return was near, and that Christians needed to “extract expeditiously whatever oil was left under their soil before their dispensation expired.”

“Here is a really profound connection that is ultimately going to be instrumental in starting one of the most important, and one of the most expensive experiments in oil production in the 20th century,” said Dochuk in an interview about his research on Pew and Manning’s relationship.

Pew, who was no longer officially the head of Sun Oil by the early 1960s but was still a dominating figure in the company, began exchanging letters with Manning that referenced the Bible, discussed Presbyterian and evangelical conferences, and had religious book recommendations.

Pew asked Manning if he could cite his sermons in his public talks, Dochuk wrote, while Manning told Pew that Christians like them needed to “take an uncompromising stand for the faith” in their work.

“They saw each other as kind of brethren, if you will, within the church, sharing a similar conservative evangelical gospel,” said Dochuk.

The two became close friends. They met in person at a ceremonial unveiling of the Great Canadian Oil Sands project in 1964, and again in Jasper, Alta., in the Rockies. The friendship helped overcome a level of skepticism on Manning’s part of an American company extracting riches from Alberta’s natural resources.

Dochuk said it wasn’t an easy negotiation when it came to business and government, as Manning was a populist at heart, while Pew was a libertarian conservative.

“Nevertheless I would say that the relationship between the two men, based on their shared values, was instrumental in getting that project off the ground and running,” he said about Great Canadian Oil Sands.

While there was a possibility that climate change was a topic of concern between Pew and Manning, Dochuk added, nothing he came across in his research pointed to proof that it was.

“There was just an assumption that this was an anthropocentric project of Christian stewardship, of using the land, that this is a God-given resource,” he said.

“I don’t think (climate) was on the radar, certainly in the way that we might imagine it to be today.”

Pew’s views, and Manning’s views, don’t represent the entirety of Christian ideology when it comes to climate change today.

In fact, dozens of Christian organizations and institutions around the world divested from fossil fuels in 2021. The Vatican itself has asked Catholics to divest from the oil and gas industry.

The World Council of Churches, which has declared its support for climate justice, issued a statement at the outcome of the last United Nations Climate Change Conference that expressed “disappointment and dismay” at the extent of progress by governments to commit to addressing the climate crisis.

Human beings are “dependent on the divinely created web of life for our well-being” and “carry the responsibility to care for God’s creation,” the council’s statement read, adding “sisters and brothers in poor, vulnerable and marginalized communities are facing the worst impacts of climate change while those responsible for the crisis continue to resist the demands of solidarity and justice.”

More warnings on emissions at the dawn of the Syncrude oilsands megaproject

Dembicki’s book shows how Sun Oil’s success in the oilsands was soon followed by a second megaproject backed by the American oil behemoth, Exxon, which by 1970 had grown to become the second largest corporation in the United States.

By this time, Exxon had long been the majority owner of Canadian oil company Imperial Oil, and that ownership structure continues to this day. Similar to Sun Oil’s experience, officials at Imperial Oil were also exposed to early warnings about climate change, even as the company was setting up its own oilsands megaproject, Dembicki wrote.

At first, Imperial Oil, through a partnership with Los Angeles-based Richfield Oil, pitched a plan to unleash a nuclear explosion in the oilsands, with the theory that it would melt the heavy oil and allow for easy pumping to the surface.

After that disastrous idea was put on ice in the late 1950s, Imperial Oil and its partners launched Syncrude, a joint effort that was first established in 1965, with preparations at a site at Mildred Lake beginning in 1973 and production starting in 1978.

The Syncrude megaproject, which grew to produce over three billion barrels of oil by 2019, was put into motion after the company was warned by internal scientists on three separate occasions in the 1970s about the dangers of fossil fuel use.

The first warning came in 1970 from an Imperial Oil chemical engineer working in Sarnia, Ont. The scientist’s report, “Pollution Is Everybody’s Business,” included a description of “air pollutants,” one of which was carbon dioxide, which he noted came from “oxidation of plant and animal matter” and “combustion.”

“Since pollution means disaster to the affected species, the only satisfactory course of action is to prevent it — to maintain the addition of foreign matter at such levels that it can be diluted, assimilated or destroyed by natural processes — to protect man’s environment from man,” reads a line from the report.

The report also argued that pollution “cannot be dealt with on a voluntary basis” and so the “protection of the interests of society as a whole requires the establishment of legal controls on pollution, as on other anti-social acts.”

Then in 1977, a senior Exxon scientist and top expert in the company’s research and engineering arm, gave a dire presentation to the company’s management committee warning that carbon dioxide from burning fossil fuels will put humanity in danger by heating up the planet.

The scientist made it clear that “there is general scientific agreement that the most likely manner in which mankind is influencing the global climate is through carbon dioxide release from the burning of fossil fuels,” according to an investigation by InsideClimate News.

The following year he informed Exxon managers and other company scientists about research showing how average global temperatures could climb by two or three degrees Celsius as carbon dioxide became more concentrated in the atmosphere, leading to floods and droughts, and jeopardizing agriculture.

“Man has a time window of five to 10 years before the need for hard decisions regarding changes in energy strategies might become critical,” he wrote in a summary to Exxon in 1978.

At first, Exxon responded rapidly, launching an internal research body that sampled carbon dioxide and engaged in climate modelling, but by the late 1980s the company would begin scaling back the work, according to the InsideClimate News investigation, and directing its resources toward climate denial instead.

“It put its muscle behind efforts to manufacture doubt about the reality of global warming its own scientists had once confirmed. It lobbied to block federal and international action to control greenhouse gas emissions. It helped to erect a vast edifice of misinformation that stands to this day,” wrote the journalists.

Syncrude continued to operate in the decades that have followed, with Imperial Oil and its Exxon owners playing a central role in maintenance and energy management support for the project. In 2021, Suncor took over operations at Syncrude, but Imperial Oil still owns 25 per cent of the operation.

The InsideClimate News investigation, the revelations of which became known as “Exxon Knew,” was a finalist for the Pulitzer Prize in public service as well as the recipient of a White House Correspondents Association award, and other accolades.

Yet Exxon rejected the work as “deliberately cherry-picked statements” that were “taken completely out of context” and that “ignored other readily available statements demonstrating that our researchers recognized the developing nature of climate science at the time which, in fact, mirrored global understanding.”

The company continues to claim it has not misrepresented its research or climate disclosures to investors or the public, calling “Exxon Knew” a “coordinated campaign perpetuated by activist groups with the aim of stigmatizing ExxonMobil.”

Yet it also appears to continue to engage in climate denial. A U.S. congressional investigation has recently revealed internal Exxon documents showing how the company pushed for the removal of comments in a 2019 policy statement that could have committed it to advocate on decarbonization goals.

Imperial Oil says it supports the Paris climate agreement and wants to “mitigate emissions” at its facilities. Like Suncor, it has also committed to reaching “net zero emissions” by 2050. But so far it has only committed to cutting its emissions intensity, not its absolute emissions.

The Narwhal offered Imperial Oil a chance to comment on any steps the company took while involved in the origins of Syncrude to address any scientific warnings about climate change. Spokesperson Lisa Schmidt said the company has nothing to add to the story.

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The building at 1209 Orange Street in Wilmington, Delaware, isn’t the first place Albertans might associate with their government’s push for pipelines.

You won’t see any politicians wearing construction hats and standing behind podiums at this two-storey, yellow-brick structure.

It is home, however, to a popular service that offers companies a registered address to receive official documents within the state, even if its owners are not physically present there. Walmart, Verizon and eBay have all used its services, state records show.

Another client was a Delaware-based firm named 2254746 Alberta Sub Ltd. Behind the company’s vague name is a familiar face: Alberta Energy Minister Sonya Savage.

The minister, a former pipeline industry lobbyist, is responsible for the Alberta Petroleum Marketing Commission, a provincial Crown corporation tasked with selling the province’s oil and gas to the world.

The commission owns 100 per cent of 2254746 Alberta Sub Ltd. It created the company on March 30, 2020, just one day before the commission entered into an investment deal with TC Energy Corp., the oil and gas giant behind the Keystone XL pipeline project, to commit up to $7.5 billion in public money to subsidize the multinational company.

The numbered company was not the only one that the commission would use in its investment deal with TC Energy. It would ultimately work through four other numbered companies — two more based in Delaware and two in Alberta.

The business structure demonstrates the lengths to which Alberta went to invest taxpayer money in Keystone XL — including up to $7 million in “administration and finance costs” according to a provincial audit. The province made this financial gamble at a time when Alberta Premier Jason Kenney admitted, in an April 2, 2020, speech to the provincial legislature, that the project was already facing significant “political risk.”

The purpose of 2254746 Alberta Sub Ltd., according to the commission’s annual report, was to allow Alberta to help finance the costs of building the U.S. portion of the pipeline, which was meant to massively expand Canadian crude oil exports from Alberta. It would have brought 830,000 barrels per day of crude from Hardisty, Alta., to Steele City, Nebraska.

The project, however, actually left the province on the hook for $1.333 billion, according to Alberta auditor general Doug Wylie. Alberta shared in the financial pain that the company suffered after U.S. President Joe Biden issued an executive order on his first day in office that revoked the pipeline’s permit.

Biden, noting that the planet is facing a climate crisis, said the project would “undermine U.S. climate leadership” and make it harder for Americans to influence other countries to take ambitious climate action.

TC Energy pulled the plug on Keystone XL a few months later in June 2021 and its assets plummeted in value.

Alberta and TC Energy are now trying to recoup their losses through two separate challenges under the Canada-U.S.-Mexico-Agreement. Alberta launched its challenge on Feb. 9, seeking “damages” of $1.3 billion.

The Canada-U.S.-Mexico-Agreement has a provision that allows for older rules under the North American Free Trade Agreement to still apply if investments were made before the new agreement took effect in July 2020. Alberta is using those “legacy” NAFTA rules in its challenge.

In doing so, the commission has drawn upon the Delaware companies to argue that it has standing to pursue a claim, according to a NAFTA document drawn up by the commission’s lawyers.

NAFTA rules are clear that an investor of a party may submit a claim to arbitration that another party has breached certain obligations. What is less clear is whether a provincial Crown corporation falls within the definition of an investor, and whether the Delaware subsidiaries would be considered to be investments in Keystone XL under NAFTA rules.

Because of their numbered names and use of registered address services, the state corporate records of Delaware give no hint of the Alberta Crown corporation’s ownership of these companies, other than the fact that the word “Alberta” is in some (but not all) of the company names. Only the commission’s annual report, or the document from the commission’s lawyers, make the connection clear.

Transparency International Canada’s executive director James Cohen said provincial governments and Crown corporations should be voluntarily naming themselves in corporate records, even if there are no explicit requirements to do so. He called Delaware a “very well known secrecy jurisdiction.”

“The paper trail should be there through the whole thing,” he said in an April 26 interview. People looking at corporate registers, he said, shouldn’t have to cross-check their search with company names in annual reports.

When The Narwhal searched for the corporate records in Delaware, it found that 2254746 Alberta Sub Ltd. was assessed on March 2, 2022, as “delinquent” for failing to pay US$386.26 in taxes or file an updated annual report.

Asked about this, the provincial commission’s chief of staff, Lynda Gwilliam, told The Narwhal in an email that the company’s taxes “were initially delayed, but have since been filed with the appropriate bodies.”

Gwilliam did not provide an explanation for the delay, but wrote that its Delaware corporate structure was nothing out of the ordinary.

“For the partnership with TC Energy to build [Keystone XL], the [Alberta Petroleum Marketing Commission] set up companies in both countries, as is a common practice in such situations,” Gwilliam wrote on April 22.

“These companies were utilized to construct the [Keystone XL] project and were in no way a ‘backup plan’ related to any subsequent NAFTA claim.”

‘If you want to quickly set up a U.S. entity, you just go to Delaware’

The commission’s legal document that lays out the Delaware investment structure is known as a notice of intent. It has to be delivered to the disputing party, in this case the U.S. State Department, before a claim can be filed. Given the required window from when the notice was delivered, the earliest the commission can file its claim is May 10.

The law firm representing the commission in its trade challenge is Washington, D.C.-based Crowell & Moring LLP. A spokesperson for the law firm confirmed April 5 that it was representing the province but declined to answer any other questions.

The commission’s investment deal with TC Energy, which it carried out through the Delaware and Alberta companies, means that it “qualifies as ‘an investor of a party,’ ” its lawyers argued in the document, and is “accordingly capable of pursuing a claim on its own behalf” or on behalf of its investments.

Delaware is known as a jurisdiction where it is cheap, easy and quick to create new U.S.-based corporations, said Mitchell Stein, an associate professor and director of the CPA-Ivey Centre for Accounting & The Public Interest at Western University in London, Ont., in an interview in April

“If you want to quickly set up a U.S. entity, you just go to Delaware, phone a lawyer up there and snap — there’s your entity, thank you,” said Stein, who has researched how U.S. states changed their corporate laws in part to compete for business registrations.

“Probably their lawyers thought it was the quickest and easiest way to do this, at the lowest cost.”

Another company the commission used in Delaware, named 181531115 Limited Partnership, was a type of business called a special purpose vehicle. This means it was created to assume financial risks and protect a parent company or companies. It used a different registered address, this one located on the outskirts of Wilmington. Its purpose was to administer the pipeline project’s “costs, revenues and management,” according to the NAFTA document. This company isn’t mentioned in the commission’s annual report because it wasn’t created by the Crown corporation itself, Gwilliam confirmed by email on May 2. The commission’s financial statements do refer to “investments in various TC Energy-affiliated subsidiaries as part of the partnership that was in place,” she wrote in an email.

The five companies in Alberta and Delaware are interconnected, either as intermediaries or shareholders of one another. Little else is known about their operations or management.

A spokesperson for the Delaware division of corporations, part of the state government, explained on April 21 that companies like those set up by the commission would not normally list the officer or director names as part of their corporate filings.

Savage’s office did not answer questions from The Narwhal about the Keystone XL investment or the Delaware corporate structure. A spokesperson acknowledged April 11 and again on April 21 that he had received questions but had not provided any comment by the end of April.

TC Energy declined comment, saying all details available to the public were already contained in its public disclosures.

The U.S. State Department doesn’t comment on pending litigation, said a spokesperson by email.

Wylie, the provincial auditor general, also verified whether the commission had accurately accounted for the government’s $1.3 billion in losses stemming from its deal with TC Energy and concluded in an audit that the numbers were accurate, but could change as assets are being liquidated.

‘That investment turned out to be essentially worthless’

According to its 2021 annual report, TC Energy said that the value of its Keystone XL assets had dropped from an original value of $3.3 billion to an estimated $175 million.

On June 9, 2021, Alberta announced that it had signed an agreement with TC Energy that would provide for an “orderly exit” from their “partnership.” Seven days later, on June 16, the commission’s annual report said it sold its old pipeline shares back to the company for a “nominal amount.” It is unclear whether Alberta was bound to sell back the shares as part of the exit agreement or the original investment deal.

Stephen Ellis, an energy and utilities strategist for Morningstar, a Chicago-based financial services firm that offers star ratings of businesses based on performance measures, said the “nominal amount” meant pennies.

“The government invested the money in the pipeline, and that investment turned out to be essentially worthless,” he said.

Ellis said TC Energy made a “smart decision” to partner with Alberta to “share the risk among multiple parties,” which he considered a “good financial practice in terms of protecting their own shareholders.”

In theory, he said, if the energy company was to prevail in its own NAFTA challenge, where it is asking for $15 billion in compensation, “it’s possible that some of that money might be shared with the government of Alberta.”

A month before Alberta made its investment in Keystone XL in spring 2020, TC Energy executives had admitted the pipeline project still required legal approvals and was still dealing with litigation.

There was also an Indigenous and climate movement opposed to it — not to mention the risk that it could be stripped of its presidential permit if the White House changed hands that fall.

During his speech to the Alberta legislature that April, Kenney promised Albertans that he had “taken every measure to protect taxpayers.” When the pipeline project was completed, he added, the province expected to make a “substantial profit” by selling its stake and predicted it would generate “$30 billion in Alberta government revenues” — money he said could be used for “health care, for education, for social programs, for our standard of living.”

Alberta finance critic Shannon Phillips, who was the environment minister under the NDP government of Rachel Notley, told The Narwhal in an interview April 5 that the Keystone XL deal showed how Kenney and the UCP “have taken massive risks with our money.”

“There’s absolutely no way that we would have entered into an agreement such as this,” Phillips said.

“You do not have to have an MBA, you only have to have a Google News feed to understand that Donald Trump was the least popular president in U.S. presidential history, and to spend $1.3 billion on a bet that he would be re-elected, has got to be up there in the stupidest political plays of all time.”

Phillips said the $1.3 billion that the government lost in the deal could have been used in other areas too, what she described as “real diversification projects, real infrastructure, real investments in health care, education or making life more affordable.”

‘The court takes TC Energy at its word that Keystone XL is dead’

In addition to the investment deal and the NAFTA trade challenge, Alberta has also pursued other Keystone XL-related litigation and promotional activity in the U.S.For example, the province intervened in support of a separate lawsuit filed by Texas and 22 other states, challenging Biden’s revocation of the Keystone XL presidential permit.

In a court filing dated Sept. 16, 2021, the province asserted that Keystone XL — which at that point had already been terminated by TC Energy — was actually still a “viable, international pipeline project.”

The province tried to appeal to U.S. interests, arguing that the pipeline project would create jobs, bring state and local tax revenue and income for local businesses, and provide “essential crude oil supplies” for producing “life-enhancing products” and supporting the United States’ “long-term energy security.”

In January 2022, the lawsuit was dismissed by a U.S. federal judge, who wrote that the case no longer had any relevance.

“The court takes TC Energy at its word that Keystone XL is dead,” the judge wrote.

“And because it is dead, any ruling this court makes on whether President Biden had the authority to revoke the permit would be advisory. Thus, the court has no jurisdiction and the case must be dismissed as moot.”

Kenney lobbying for ‘another major pipeline,’ a ‘replacement for Keystone XL’

As the NAFTA trade challenge continues, Kenney is now looking beyond Keystone XL.

The premier met with U.S. Senator Joe Manchin, the chair of the U.S. Senate energy committee, in Calgary in April and toured oilsands operations. According to Kenney, they discussed a replacement for the pipeline project.

Any new cross-border pipeline proposal would have to contend not only with a skeptical White House, which threw cold water on the idea last month, but also the fact that Enbridge’s $8.2 billion Line 3 Replacement Project came online in the fall of 2021.

The expanded pipeline is supplying 760,000 barrels per day of Canadian crude oil to U.S. refineries, a major expansion of Canada’s export capacity, and handing Canadian producers more access to the U.S. Gulf Coast, which had been a goal of Keystone XL.

When the subject of Keystone XL came up at an April 12 press conference, Manchin, who has pushed back on climate initiatives and who benefits from significant campaign contributions from the oil and gas industry, shrugged it off as “a sore point for both sides.”

“The brand of the XL pipeline is probably gone,” the senator said. “Can it be rebranded? Can it be rerouted? Can it be different things …” he wondered aloud before trailing off. “We need this product.”

Kenney also told viewers of an April 20 livestream that he planned on meeting with members of Manchin’s committee in Washington, D.C. in May “to discuss what we call the North American energy strategy, which would include another major pipeline.”

“We continue to have fruitful discussions with many key leaders in the United States about what might be a replacement for Keystone XL,” Kenney said.

“And I believe where there’s a will there’s a way — that if we get the right alignment in the U.S. Congress, it’s conceivable that you could have a strong majority, perhaps even a veto-proof majority, to pursue a successor to Keystone XL.”

Updated on May 5, 2022, at 11:44 a.m. ET: This story was updated to correct information from a source that had stated that NAFTA rules would not allow the Government of Alberta or its Crown corporations to sue the U.S. government. What the NAFTA rules actually say are that an investor of a party may submit a claim to arbitration that another party has breached certain obligations. The story was also updated to add information received after deadline to clarify why one of the numbered companies was not listed in the Alberta Petroleum Marketing Commission’s annual report.

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