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‘We need to embrace our energy industry’: Brad Tennant on Canada’s oil and gas sector and the threat of tariffs

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Pumpjacks pump crude oil near Halkirk, Alta., June 20, 2007. Larry MacDougal/The Canadian Press.

Publisher Rudyard Griffiths sits down with Wellington Advocacy vice president Brad Tennant to discuss his recent article discussing Canada’s oil and gas sector landing in the political crosshairs of Canada’s looming free trade fight with the U.S.

The following is an automated transcript. If you are quoting from or referencing this episode, please refer to the audio to verify.

RUDYARD GRIFFITHS: Brad, welcome to up to speed an occasional video series here at the hub where we get the latest from our columnists and contributors. Today, I’m pleased to welcome on to the program Brad Tennant, Vice President at Wellington advocacy who had a terrific piece for us the day of the Trump inauguration, all about Alberta’s reaction to growing demands by other provinces and the federal government that Canada’s oil and gas sector become a key part of any kind of retaliatory strategy or scheme to respond to potential threats of us tariffs. Brad, welcome on to the program. Thank you very much for having me. Let’s talk a little bit about this article and some of your key arguments. What I was really intrigued about, Brad, maybe you can lay out for us is the extent to which the situation that faces the oil and gas industry now is very different, even than a decade ago. A lot of other avenues that we might have spent over the last 10 years getting oil and gas to other markets other than the United States to give us more options in this situation where we face an increasingly hostile US administration were closed off by the Trudeau Government. Can you run us through that kind of laundry list of squandered opportunity?

BRAD TENNANT: Yeah, absolutely. It’s not always the funnest list to go through. I, you know, I spent time at the start when, when Trudeau was elected. I worked in Canada’s oil and gas industry, and I think we saw this come one by one, just the cuts and the cuts and the cuts that came with Trudeau leadership on the oil and gas file, you know, and I just on the piece, I find it to be quite ironic that now, when Trudeau is exiting kind of stage left on this, he is holding on to the oil and gas industry as its only kind of major asset. Mark Carney, when he went on to the Jon Stewart show, the only real point of Canadian economic strength he could bring up was that Canada exports 4.5 million barrels of oil to the United States. And if that were ever to be replaced, it’d be replaced by something or somewhere like Venezuela for most of Trudeau reign. That was something you couldn’t even get the Liberals to admit to. And the cuts kind of came. They started, obviously. We saw the cancelation of Northern Gateway right from the gate. We saw numerous regulatory rule changes. We saw the blow up of the National Energy Board. We saw Bill C 69 we saw Bill C 48 all things that limited Canada’s ability to export oil and gas. And then on top of it, we saw regulatory approval time shoot through the roof. We saw, you know, numerous other things that came with that that made it harder to do oil and gas. You know, I wrote this article and it didn’t even cover the carbon tax, because Trudeau has done so much to hurt Canada’s oil and gas industry, which, when you look at Canada as an international level, it’s still our strength, it is still our largest export. So you know, I found the article almost funny, ironic on one hand, and just aggravating on the other, because there are so many ways that this government in a country that relies so much on Canada’s oil and gas sector has has gone far and beyond to hurt it.

RUDYARD GRIFFITHS: Yeah, and I think the key point, Brad, is that look, you know, hindsight is 2020 but where we find ourselves today with, again, the potential for American terrorists, whether they happen this week, next week, next month, beside the point, a very contested, no doubt, renegotiation of usmca agreement, the free trade agreement in 2026 we would have had a much stronger hand to play if we would have had other sources for our oil, so if we would have been able to get our oil to tide water. And yes, there was one pipeline built under the Trudeau Government, and we should give them credit for that. But if we’d been able to get energy to the east, if we’d been able to respond, as you mentioned in the article, to Germany, you know that came to us at the height of the Ukraine war, and said, Look, we need your natural gas. Give us your hydrocarbons, Brad, How different could the situation that we’re in now be if we’d been had more foresight, if we thought in a way, let’s diversify. Let’s make sure that all this, all these riches, aren’t just flowing into a single market to a single customer. How different would the hand be that we could play with the United States across the whole tariff file be today.

BRAD TENNANT: Entirely different. There could be a strength where now we have an innate structural weakness. International markets wanted these Canadian energy products. They wanted our LNG. They wanted oil and gas. They wanted pipelines. They wanted to be able to buy Canadian energy. I. I mean a simple search to where international energy products come from. Right now, Canada could be a supplier of choice. Instead, the Trudeau Government decided to take shot after shot against our oil and gas industry, and then on top of it, do things like you mentioned. When Germany came, we argued with them the business case for Canadian LNG exports. We we argued with international markets that were coming here. And you know, Trudeau, which was mentioned in the article, even pondered himself about phasing out the oil sands. So, you know, this is something that it’s it’s an own goal by the Trudeau Government. It is something that I think will set Canadians back for a generation. Other oil and gas producers around the globe have not taken this time to slow their industry down. Even the United States, which under that tenure was led by both Barack Obama and Joe Biden, at certain points, is has been building their energy infrastructure, leapfrogging us on that. You know, the last 10 years on natural resources is setting us back, I think, for a generation. And kind of like I mentioned as well, nobody’s coming to Canada right now begging for our green energy exports. Nobody’s coming to Canada asking for that sort of product, which Trudeau was trying to pump up for years. And you know, when we’re talking about tariffs with the United States, nobody’s worried that that might affect, you know, windmill exports to the United States. It’s just not happening. We know our strength is in oil and gas, and that’s a strength that’s been severely weakened by Trudeau overthe last decade.

RUDYARD GRIFFITHS: Finally, Brad, what can we do differently? So if we now have come to a realization that our relationship with the United States is not maybe that of two best friends of that so called special relationship, and we need to consider all the wedges, all the advantages that we can get. Surely, one of those in the future would be to diversify our energy markets, to get more of our oil and gas to different tidewaters, whether it’s at the Pacific or at the Atlantic, and ensure that when the Americans are negotiating with us about anything, whether it’s terrorists, whether it’s security, whether it’s access to their markets, that they know that we have another card to play When it comes to these hydrocarbons, and that in a sense, Canada isn’t a captive seller. We are a seller with options. What would your policy prescription be, Brad, to create that kind of playbook for a future government?

BRAD TENNANT: Yeah. Thank you. Great question, and I think the answer is to completely embrace the Canadian energy industry and really wrap our arms around this industry. We are lucky as Canadians to have this resource. This resource is what people want internationally in Canada, I was reflecting when writing in this article, Trudeau traveled abroad in 2015 and talked about how Canadians, you know, in his and this was a critique of the previous government at the time, but he talked about how Canadians need to be known more for what’s in between their ears and what’s below their feet. I think that problem that was a problem twofold, in that it didn’t recognize that in order to get the resources that are under Canadians feet, it takes a lot that’s kind of in between the ears. And then on top of that, that this is a resource Canada has that other jurisdictions don’t have. So I think that the problem the whole Trudeau is Doug is going to take something that will take time to get out of, but it’s something that needs to start in the earnest. For the next century, Canada’s advantage will be our natural resource sector. Natural resources are still wanted more in the world than ever, and if you’re looking at the next 10, 20, years, by any assessment, there is more ofa desire for Canadian natural resources. So I think this is going to take a full government approach, knowing we are behind, to look at new resource markets, to take advantage of the opportunity, to get new markets for our resources, and to really, you know, limit the taxation, the regulatory approvals, the amount of time it takes to do an energy project in Canada should not be longer than where it is for our competitors, whether that’s the United States or elsewhere. This is big hole, and it’s going to take a serious approach, and it’s going to take serious leadership, and I hope we see that leadership in the years to come.

RUDYARD GRIFFITHS: Final question, Brad, the national unity implications of all this. There’s you write about it in your piece. There’s been a strong reaction in Alberta to the idea that energy, oil and gas should somehow lead a tariff strategy, ie, we should impose countervailing duties on the Americans vis a vis, first and foremost, our energy exports. What’s the reaction to this in Alberta? Why is this really kind of roiling Albertans? What’s what may be memory? Here is this invoking when the national government and some provinces, to be fair, it’s not just Ottawa are saying, in effect, that Alberta and its energy exports should be the kind of tip of the spear in any future tariff fight with the Americans.

BRAD TENNANT: Yeah, no. I mean Prime Minister Trudeau has been in office for nine years, and this is the first time he’s asking people to take a team Canada approach when it comes to exports. We have an opportunity, I think, to build across the country, build a strong foundation for exports. But the truth is, you know, Alberta has been kind of wearing that Team Canada jersey for a decade, and other special interest groups, provinces and largely the federal government, too, have been working actively against Canada’s largest export, that being oil and gas. So, you know, I think that there is, you know, I’d like to say it’s the first time with this Trudeau Government, but it happens quite often that there’s just a banging your head against the wall because they haven’t been on Team Canada when it comes to energy exports. But then, you know, within the last couple weeks, they’re asking for a team Canada approach, you know, ideally, to perhaps use Canada, or Canada and Alberta’s energy exports to try to leverage to save other smaller industries around the country. I think that there’s times in our country where we we do have that full approach, but it’s hard to go to Alberta look them in the eyes. As you know, there has been no shortage of lobbying against Alberta’s largest industry, Canada’s largest export industry. So, you know, I think this leads to a bit of a national unity issue, but it’s also just a common sense issue, and the federal government just hasn’t had common sense on this issue since the beginning.

The Hub Staff

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