Somebody flunked math..Although it attempts to smooth the edges, the wording of the federal government’s Just Transition bill is clearly aimed at the oil and gas sector. And the numbers they're using to justify it are either flights of fancy or just plain wrong..In fact, Bill C-50 holds out a carrot for Canada’s oil producing provinces in a tone that appears almost apologetic. Or condescending. .“This work is being done with both a sectoral and a regional focus, in order to help ensure that each provincial and territorial economy across Canada benefits from the global transition to net-zero. This very much includes oil-and-gas producing regions, notably Newfoundland and Labrador, Saskatchewan, Alberta and British Columbia," says a Liberal background document..On a media briefing Thursday, government representatives further claimed the Pathways Alliance — which represents the world’s largest oil sands producers — and the Government of Alberta are on board with “aggressively lowering emissions from the production of fossil fuels, in line with Canada’s climate commitments, (as) both a competitive advantage and a source of sustainable jobs.”.When pressed to show this reporter specifically what the nature of those “consultations” were, I was told that it was merely a “high level overview.” Both were consulted, I was assured..Likewise for the demand numbers used to justify the “just transition” in the first place, which are predicated on vastly reduced demand for oil. There is little doubt global oil demand may well indeed roll over by 2050, but this reporter had some serious doubts by just how much. .Backgrounder documents suggest world oil demand peaked and will continue to decline, falling 75% by 2050 to just 24 million barrels per day, as per the International Energy Agency (IEA). It also expects natural gas demand to fall by half in the same period. .That’s an eye-popper. Even the most optimistic (and realistic) Greenie I know doesn’t expect it to fall much below 75 million bpd. I asked them, “are you sure it’s correct?”.”It’s not that level of detail,” I was told of that specific figure and that it didn’t matter in the broader scheme of things. Funny, a projected 75% drop seems fairly material to me..“The key difference post-2050 will be in how oil is used. We will no longer primarily use oil in combustion applications — like cars and buses. Where we will use it beyond 2050 is in mostly non-combustion applications such as petrochemicals, asphalt, lubricants, solvents, carbon graphite and waxes,” the rep said..Similarly, for natural gas, the backgrounder clearly states the IEA’s NZE (net-zero) scenario forecasts global demand in 2050 of half of consumption levels today. However, uses for natural gas in a net-zero world will be for applications such as ultra-low carbon hydrogen production..Again, I asked, “are you sure those estimates are correct?”.The kicker is those estimates fall under the IEA’s “net zero” scenario, numbers that not even ExxonMobil, the world’s largest international oil company, believe. .Rather, the IEA’s base case actually sees demand for both oil and gas increasing — not declining — some 36% in the same period. Released barely six months ago, in January, it said oil demand will grow to 102 million bpd from 94.5 million bpd in 2021 and hold at 102 million bpd well past 2050. .That’s a big difference from 24 million bpd, as the government claims..Similarly, natural gas is projected to grow to 4.4 trillion cubic metres in 2030, from 4.2 trillion in 2021, and stay there through 2050 — not fall by half. How could it, if hydrogen becomes a $10 trillion economy as Premier Danielle Smith suggested in her Global Energy Show keynote?.Even if the IEA’s net zero scenario comes true, in 2050 oil and gas would still supply 15% of the world’s energy needs. The Coal Age may have ended in 1918 but coal production never went down. Ever..And achieving that 2050 goal is unlikely even if Canada somehow manages to reach its own target, given that two of the world’s largest emitters — China and India — have only pledged to reach net zero by 2060 and 2070, respectively..According to noted American oil guru and Pulitzer Prize winning author Daniel Yergin: “The reality is that the world still uses 80% of its energy from hydrocarbons. Just to maintain production you need new investment,” he said..“For those who say we shouldn’t invest anything in fossil fuels now, I remind you that we have to feed the system we have today while we’re moving toward the new system. This will be a difficult tightrope to walk. But it’s where we are.”.Although demand for renewables is also expected to increase, there is no way oil is going away anytime soon. Wishing won’t make so..Due to a high level of spam content being posted in our comment section below, all comments undergo manual approval by a staff member during regular business hours (Monday - Friday). Your patience is appreciated.
