OTTAWA—While most of the world’s attention on Canada is falling on Indigenous protests and rail blockades, the ramifications of the government’s decision on Teck Resources’ $20.6 billion Frontier oilsands mine should not be overlooked. It’s being called another watershed moment for the government, the resource sector, and the province of Alberta.
The mine, north of Fort McMurray with an expected 40-year lifespan, is also a litmus test for Canada’s desire to be thought of as having a reliable, transparent, and predictable supply for foreign partners looking for an alternative source.
Ken Coates, a Munk Senior Fellow with the Macdonald-Laurier Institute, says the mine’s approval process is like running a 100-metre race that turns into a 200-metre event when halfway done. And then 10 metres to the finish line, it extends to a 400-metre race.
“At some point companies are just going to walk away from all of this,” he said in an interview.
“When you look at Teck Resources spending hundreds of millions of dollars to get this far, at some point they’re going to start suing the Government of Canada for breach of faith I think.”
Reliability as an Energy Supplier
The problem is that some in cabinet believe green-lighting the mine project would run afoul of the government’s goal to make Canada a net-zero carbon dioxide producer by 2050 and undermine credibility on environmental issues.
However, it’s been said that, given the technological advances in the oilsands, Canada can play a major role in reducing pollution while continuing to use and develop fossil fuels.The oil and gas industry has cleaned up its production by leaps and bounds in the last 10 years and is recognized as a model of good governance and transparency, in contrast with authoritarian oil-producing regimes in other parts of the world.
But as the industry seeks to capitalize on the solutions it can offer the rest of the world, it continues to be hampered by the unpredictable or unforeseen.
“If it was turned down then that could send a message to our potential energy customers around the world that we’re not as serious as we talk about being an energy supplier to the rest of the world,” said Jeff Kucharski, adjunct professor at Royal Roads University in Victoria, in an interview.
And if it is not approved, the reasons for its rejection will also be closely scrutinized, he adds. What’s at risk is Canada’s reliability as an energy supplier.
“This will send a message not only within Canada but to the rest of the world,” Kucharski said.
Coates and Kucharski were participating in a Macdonald-Laurier Institute (MLI) panel discussion on Canada’s energy advantage and global energy security in Ottawa on Feb. 18. At the event, experts agreed that as Canada examines its progress on climate change targets, it can’t simply look at projects on an individual basis. Projects have to be evaluated based on their impact on Canada’s aggregate carbon footprint.
