Canadian oil and gas companies plan to increase drilling activity by 8% in the upcoming year, despite falling short of emissions targets.
Oil and gas companies have announced plans to increase their drilling activity by 8% in Canada for the upcoming year in order to utilize new shipping opportunities, such as a government-owned pipeline that has sparked controversy.
According to the Canadian Association of Energy Contractors (CAOEC), Canada is expected to fall short of its emissions reduction targets. In response, CAOEC forecasted an increase of approximately 500 wells next year, bringing the total number of projects to 6,229.
Canada, the fourth-biggest supplier of oil globally, is considering implementing a limit on emissions for its oil and gas industry. Steven Guilbeault, the environment minister, stated that the government aims to create a plan before the Cop28 summit in Dubai next week. The fossil fuel sector opposes the suggested restrictions, claiming they are overly limiting.
Despite Canada’s determined efforts to address climate change, it is projected to fall short of its target of reducing carbon emissions by at least 40% from 2005 levels by 2030. This is primarily due to the continued emissions from the oil and gas industry. According to a recent audit, the only notable decrease in emissions occurred during the 2008 financial crisis and the Covid-19 pandemic.
According to Jerry DeMarco, who serves as the commissioner of environment and sustainable development, Canada is the sole G7 nation that has not made any progress in reducing emissions since 1990. This statement was made to reporters earlier this month.
The CAOEC stated that the upcoming launch of new pipelines, such as the delayed Trans Mountain expansion project, was a major factor in the initiation of new drilling ventures.
In 2018, the Canadian government purchased the troubled TransMountain project from Kinder Morgan for C$4.5 billion (equivalent to US$3.3 billion). The prime minister believed that Canada needed to address a bottleneck in transporting crude oil, which was causing Canadian oil producers to lose billions in export revenue each year. Additionally, he promised to use profits from the pipeline to fund eco-friendly energy initiatives.
Since then, the Canadian government has invested over C$35bn into the project. However, it has faced numerous setbacks and delays, making it a poorly managed infrastructure undertaking with excessive expenses.
According to Conor Curtis of the Sierra Club Canada Foundation, there is no opportunity for growth in the oil and gas industry while also meeting climate goals. He suggests that if the resources and effort put into the Trans Mountain project were focused on renewable energy sources instead, Canadians would benefit greatly.
The majority of Canadians, regardless of their stance on expanding the oil and gas industry, are now in favor of strict regulations on emissions from this sector in order to align with Canada’s national emissions reduction goals.