Energy executives say feds must make good on pledge to speed up project approvals
Canada’s oil and gas sector expects the federal government to deliver on Budget Day promises to reduce the time it takes to build major infrastructure projects.
The liberal government announced last week that it would unveil plans aimed at speeding up the federal permitting process for major infrastructure projects by the end of the year.
This commitment is part of the federal budget, and the government believes Canada must invest in clean power, hydrogen, critical minerals, and other resources to meet international climate change commitments. It included many tax credits and incentives for technology.
But the promise of rapid regulatory approval for new projects remains key to much of Canada’s oil and gas sector.
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Enbridge Inc. Chief Executive Officer Greg Ebel said at the annual oil and gas conference in Toronto this week.
“We can have all the incentives you want. Whether it’s production deductions or investment tax deductions, if you can’t build[the project]you can’t use it.”
The oil and gas sector is Canada’s largest emitter of greenhouse gases and is under intense pressure to reduce its carbon footprint.
Industry executives say it will require billions of dollars of investment in new infrastructure to do this at a pace the federal government is comfortable with. This includes his proposal for a $16.5 billion carbon capture and storage transportation line being considered by a consortium of oil sands companies known as the Pathways Alliance. A building in northern Alberta.
The oil and gas industry has successfully lobbied for investment tax breaks for carbon capture and storage, de-risking such projects by essentially guaranteeing operators a fixed price for carbon. We also have a government commitment.
Although a final investment decision has not yet been made, the Pathways Alliance (comprising Canadian Natural Resources, Cenova Energy, ConocoPhillips Canada, Imperial Oil, MEG Energy and Suncor Energy) said it intends to apply for regulatory approval for the carbon. Pipeline as early as this fall.
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But Cenovus executive vice president Rhona DelFrari said the project must encounter a smooth and painless permitting process if the group is to meet its 2030 emissions reduction target. .
“If it takes years, you won’t reach your goal, and then you could end up in court,” said DelFrari.
Over the past decade, Canada’s energy sector has seen lengthy permitting timelines and regulatory uncertainty slowing everything from major oil pipeline projects to the development of the country’s liquefied natural gas (LNG) industry. I’ve been dissatisfied with it.
Perrin Beatty, CEO of the Canadian Chamber of Commerce, said Canada’s pipeline, mining and infrastructure development has a history of regulatory challenges that “delay projects year after year.”
“People write off their investments and walk away,” Beattie said in an interview last week.
“In many cases, an early ‘no’ is better than an indefinite ‘maybe’ that binds capital for years. ”
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South of the border, businesses have filed similar complaints. US President Joe Biden has promised to improve communication and cooperation between federal agencies and accelerate the country’s permits and environmental reviews.
MEG Energy CEO Derek Evans said the oil and gas industry is committed to net zero greenhouse gas emissions by 2050. And he said 2030 is not far off, when Canada has pledged to cut emissions by at least 40-45% from 2005 levels.
“The question is, ‘How fast do you want it to go?'” Evans said. “But we must begin. The clock is ticking.”
© 2023 The Canadian Press
