Canada’s plan to increase oil exports will not jeopardize climate goals – government source

An oil pump jack pumps oil in a field near Calgary, Alberta, Canada on July 21, 2014. REUTERS/Todd Korol

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OTTAWA/CALGARY, Alberta, March 23 (Reuters) – Canada on Thursday will outline plans to increase oil exports to ease tight global markets following Russia’s invasion of Ukraine, but the increase will not undermine Ottawa’s long-term climate commitments, a government source said.

Natural Resources Minister Jonathan Wilkinson will detail Canada’s plans at the International Energy Agency (IEA) meeting in Paris, the source said.

Wilkinson told Reuters earlier this month the government is working with industry to find ways to increase pipeline utilization and boost crude oil exports, and pipeline company Enbridge Inc (ENB.TO) said it was ready to ” what it can do”. Continue reading

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Canada, holder of the world’s third-biggest oil reserves, is keen to shore up long-term energy security as countries that previously relied on Russian oil and gas seek replacements as sanctions aim to punish Russia for its attack on Ukraine . But the government has no plans to compromise its climate targets.

“There is no real desire to shift focus to emission reductions and the environment. We’re not overturning the climate rulebook,” added the source, who declined to be named due to the sensitivity of the information.

A spokesman for Alberta Energy Minister Sonya Savage said Canada could supply an additional 200,000 barrels per day (bpd), about 5% of current exports to the United States and a fraction of the 3 million bpd of Russian supply expected to be missing from April would. Continue reading

Many producers, particularly in the oil sands of northern Alberta, where new multibillion-dollar projects take years to build, are reluctant to increase spending to significantly increase production. Continue reading

Critics say Canada is missing its climate targets.

In 2018, Liberal Prime Minister Justin Trudeau’s government bought the Trans Mountain oil pipeline to help producers who were struggling to get their crude oil to market.

CO2 emissions from the oil and gas sector have increased by 20% since 2005 and contribute 26% of Canada’s total emissions, making Canada the largest emitting industry.

The government has committed to cutting carbon emissions by 40% to 45% below 2005 levels by 2030 and is expected to present a detailed emissions reduction plan by the end of March.

“The Ukraine crisis has led to more attention being paid to energy security,” said George Hoberg, professor of public policy at the University of British Columbia.

“There will be a lot of pressure from the oil and gas sector (to expand the industry) but this would be inconsistent with Canada’s climate commitments.”

Next month, the government will decide whether to approve Norwegian oil company Equinor’s (EQNR.OL) Bay du Nord project off the coast of Atlantic Canada. Bay du Nord has an estimated 300 million barrels of mineable resources.

Environmental groups like the Sierra Club have accused the oil and gas industry of exploiting the Ukraine crisis to gain more support for the project.

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Reporting by Nia Williams in Calgary and Steve Scherer in Ottawa; Edited by Bill Berkrot

Our standards: The Thomson Reuters Trust Policy.

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