Last week, the federal House of Commons voted 197 to 137 against a Conservative “pro-investor” motion to recognize Canada as a “competitive, resource-producing nation” and repeal federal anti-energy, anti-development regulations.The timing couldn’t be worse, given the competitive new realities that Canada faces. Anyone, including Prime Minister Mark Carney, who says the US-Venezuela “intervention”, for example, won’t significantly impact the Canadian oil sector is wilfully blind. As he put it himself, “If we’re not at the table, we’re on the menu.”“Canada should be worried. Trump has zero loyalty to Canada,” writes the Report on Business’ Eric Reguly. “Venezuela’s heavy crude has the same make-up as Alberta oil sands’ crude, and US oil refineries along the Gulf of Mexico could switch without breaking a sweat.”Experts now speculate that Venezuelan oil production, freed from nationalization, could increase by 50% relatively quickly. Venezuela has three times the US’ reserves and was, at one time, producing 3.5 million barrels-per-day (bpd). It’s now 1 million. (By comparison, Saskatchewan produces about 450,000 bpd and Alberta four million). Crucially, the new US-Venezuela partnership will nudge American production closer to 30% of global reserves.Until the US action, Venezuela was a dirty-oil secret. Canada became a customer when — much like Chavez-Maduro’s Venezuela — it drove oil production and investment into the ground. Speaking of which, Google “Greenland and oil,” and this 2022 headline pops up: “Greenland bans all oil exploration.” Sound familiar?.Energy decisions have consequences. It’s not too late to read the international room — and change our economic fate. Problem is, the Memorandum of Understanding (MOU), recently signed between Alberta and Ottawa, isn’t the way to go. MOUs don’t have teeth. They’re little more than pinkie promises which governments sign when they don’t know what else to do. Yes, the document signals some positive paradigm shifts. For one, the feds will finally allow tax credits for CO2 enhanced oil recovery projects — the only remotely economic thing about carbon capture. The MOU also scraps the federal oil and gas caps. But other Trudeau-era legislation remains firmly, subtextually entrenched.Case in point: the Impact Assessment Act (IAA), or Bill C-69. Alberta says Ottawa has “agreed to address” it through a future “cooperation agreement” (another pinkie promise). Meanwhile, the feds have been working around the IAA — signalling that one-off, project-by-project provincial environmental assessments could substitute for federal ones. That’s not “streamlining.” Why not just repeal the IAA and send a consistent, open-for-business message once and for all?Another Trudeau-Guilbeault-era holdover: the federal Clean Fuel Standard, aka “Carbon Tax #2,” which is adding 7 cents a litre to Canadians’ gas this year. In fact, the feds are sluicing out $370 million in biofuel subsidies as we speak — designed to help Canadian companies stop importing biofuel from the US to comply with Canada’s own net zero rules. Nuts.Also entrenched — even strengthened — in the MOU, along with the industrial carbon tax, are federal methane rules, a de facto oil production cap. The previous methane mandate, to cut emissions by 75%, has been delayed to 2035 — but only in Alberta. Another one-off. All provinces should be shouting from the rooftops that, constitutionally, the feds have no business regulating specific provincial industries, MOU or not. .Finally, the BC tanker ban may be “potentially exempted” — but has not been scrapped. This, as double hulls have reduced spills, US tankers safely transport Alaskan oil around the clock, and the Port of Vancouver has been loading tankers since the 1950s without incident.The most important MOU goal, of course, is the construction of at least one private-sector-financed pipeline. This would prevent more oil being produced than there is takeaway capacity, so that producers don’t have to discount their US price. As a result of not building pipelines, Canada has benefited US oil refineries by some $50 billion!But given Canada’s extreme regulatory and investment uncertainty — including over who actually owns the land in BC — which private company is going to step up? In the face of hemmoraging disinvestment of capital to the United States, it’s time to repeal economically destructive federal regulations — not simply replace them with watered-down versions (see electric vehicles). And it’s time to replace the clichés about unity and diversifying trade with real action.MOU? More like Mission Outstandingly Unlikely. —This article appeared in a modified form in the Edmonton Journal
