It’s taken years of herculean effort to get major pipeline and LNG developments approved and constructed.
On the eve of an election call, the heads of Canada’s largest petroleum producers and pipeline operators have issued an open letter to the country’s federal political parties, rolling out a blueprint to encourage building new energy infrastructure and boost output.
“It’s a Canadian sickness that we can’t get things built,” Strathcona Resources executive chair Adam Waterous, one of the industry leaders who signed the document, said in an interview.
“We think it’s going to require the emergency powers of the federal government to rapidly put in this regulatory framework.”
Opinion polls this year show more Canadians support building new pipelines from coast to coast, as U.S. President Donald Trump’s tariff threats have highlighted the reality that more than 90 per cent of Canadian energy exports head to our largest trading partner.
Meanwhile, some parts of central and eastern Canada rely on the U.S. for oil and natural gas.
More infrastructure is required to access new markets, beyond the Trans Mountain pipeline.
However, it’s taken years of herculean effort to get major pipeline and LNG developments approved and constructed.
Of five major oil pipeline projects proposed over the past 15 years, only two were built — the Trans Mountain expansion and Enbridge’s Line 3 replacement project — and three failed, said Kevin Birn, Canadian oil markets chief analyst for S&P Global Commodity Insights.
The average time in review for projects was six years, while the average time of projects to move from application through to termination — or completion — was eight years, he noted.
“It’s not the regulatory process alone, it’s the whole system, from applications through reviews, through external judicial challenges, to government decision-making time — and then the complexity of construction” causing long timelines, Birn said.
In the open letter to the heads of the federal Liberals, Conservatives, NDP and Bloc Quebecois, the 14 industry CEOs call for a series of steps to get energy projects built, from overhauling government regulations to encouraging more investment and production.
“By declaring a Canadian energy crisis and key projects in the ‘national interest,’ the federal government will be able to use all its available emergency powers to ensure that the dramatic regulatory restructuring required to expand the oil and natural gas sector is rapidly achieved,” it states.
The letter calls for the planned oilpatch emissions cap to be eliminated to allow for more production growth, and for repealing the federal carbon levy on large industrial emitters “to allow provincial governments to set more suitable carbon regulations.”
The letter recommends the Impact Assessment Act be revamped, and that Ottawa provide Indigenous loan guarantees at scale to ensure Indigenous communities benefit from new developments.
The letter is signed by the leaders of the country’s 10 largest producers: ARC Resources, Veren, Imperial Oil, Canadian Natural Resources, Whitecap Resources, MEG Energy, Suncor Energy, Cenovus Energy, Tourmaline Oil and Strathcona Resources.
It was also signed by the CEOs of the country’s four largest pipeline operators — Enbridge, TC Energy, Pembina Pipeline and South Bow.
TC Energy CEO Francois Poirier said he believes the six-month time frame proposed by the group is possible, given Germany’s experience fast-tracking the building of LNG import terminals after Russia’s invasion of Ukraine.
Using existing rights of way that have already been studied, or conducting different parts of the permitting processes at the same time — instead of in sequence — could help accelerate timelines, he said.
“Declaring a state of emergency is to create a sense of urgency among Canadians, particularly policy-makers and investors, that there’s an opportunity for us to go after, but it is time-bound,” Poirier said in an interview, pointing to the potential to grow Canada’s LNG sector.
“We need certainty of timelines. Speed is important here.”
Waterous said being overly dependent on a single market has reduced Canada’s flexibility from a political perspective, and “we want to be able to diversify our markets.
“But the second thing that has impacted our sovereignty is the weakness of our economy.”
Environmental and clean energy groups note the Canadian oil and gas industry remains the largest emitting sector in the country and question the long-term demand outlook for oil.
Countries in the EU and other parts of the world will also be looking for trading partners willing to meet carbon import standards, said Janetta McKenzie of the Pembina Institute.
While there’s room to streamline regulations, six months is an “extremely aggressive timeline” for project reviews, she added.
“Ultimately, the premise here is that doubling down on oil and gas is the cure-all for this moment. But that premise begins to fall apart when you look at the global marketplace,” said McKenzie.
Former Canada Energy Regulator Gitane De Silva said she’s not aware of any mechanisms under the regulator’s legislation to fast-track projects, noting the agency regulates in the public interest.
However, removing any overlap on provincial and federal project assessments could help shorten timelines, along with changing the process so required political approval doesn’t happen at the end of the process.
“If you could move that political decision up much earlier in the process, that would be a very meaningful way to decrease timelines,” said De Silva, principal of GDStrategic.
The need to bolster the Canadian economy has intensified with the country’s lagging productivity, sluggish investment levels and growing uncertainty around U.S. tariffs.
A new forecast by ATB Financial, to be released Thursday, pruned Alberta’s expected economic growth this year to 1.5 per cent, down from 2.5 per cent forecast last December.
The Canadian economy is only anticipated to grow by 0.6 per cent this year.
Getting new infrastructure built would improve Canada’s economic potential and productivity, said ATB chief economist Mark Parsons.
“If we’re able to fast-track some of these projects, then we could have shovels in the ground soon, and that will provide an offset to some of the weakness we’re expecting on investment and exports.”
