The go-to, of course, has long been hydrocarbons, with this country enjoying fairly abundant resources of gas and oil. Some might argue that Canada has relied too much on oil exploration, to the point that the fall in oil prices eight years ago saw a resultant crash in the country’s economy.
That event has led to much speculation about the value of subsequent exploration and infrastructure to transport fossil fuels, as nations indicate their resolve to embrace greener options and drastically reduce emissions.
A new report adds fodder to that discussion. And it has implications for any push to transport oil to the Maritimes for production or to ship offshore.
The Centre for International Governance Innovation casts some doubt on the need for new pipelines in Canada to carry product to tidewater for export. Currently both the east and west coasts have proposals at various stages of discussion – drawing a share of protest from some circles.
Jeff Rubin, a senior fellow at the centre and a former chief economist at CIBC, says there is no marketing history to support the hope that such projects will ultimately reap the benefits of higher prices. Overseas markets pay lower prices for bitumen than in North America, he said. Add to that the growing commitment worldwide from countries to move away from a carbon-based economy.
Considering the length of time it would take to build these pipelines, that argument will only grow stronger in several years’ time.
The latest in regard to the proposed, much-debated Energy East pipeline, which would take product from the oilsands in Alberta to Saint John, N.B., sees the proposal at a hiatus. TransCanada has asked the National Energy Board to put its application on hold after the regulator said it would consider indirect greenhouse gas emissions in evaluating the project.
Oil industry champions are giving up holding their breath waiting for prices to return to what they were a decade or more ago. Consider the ramped-up production of shale gas in the United States as that country tries to be more self-sufficient in energy needs.
Production levels aside, demand for carbon fuels isn’t likely to skyrocket anyway. A number of European countries have set deadlines that will see the banning of vehicles powered by gas and diesel in a couple of decades. Improvements in electric vehicles in coming years, their range and the means to recharge, will see a lot more interest from consumers.
For a long time oil has been the kingpin in deliberations by government about economic development policies – and in their targeted revenues. Governments in Canada – federal and provincial – might easily be accused of having put all their eggs in one basket on this, to the point of being caught in the inevitable crash.
It’s sounding more and more like it’s time to shift those eggs around and provide more support for better energy efficiencies and greener technologies.