Donald Trump’s unlikely road to the White House began with a promise to build a wall on the Mexican border. The wall became such a defining feature of the 2016 campaign that it overshadowed another cross-border project many had written off as dead.
With Trump set to take office January 20, the Keystone XL project is very much back on the table. Meanwhile, the global upsurge in right-wing populism that Trump spearheads will have big implications for energy policy in Canada and abroad.
In Britain and the United States, oil and gas companies have been unexpected beneficiaries of nativist populism. After Brexit upended the U.K. political system, for example, Britain has a PM who thinks the country is ripe for fracking.
In addition to reviving Keystone, which would carry Alberta oil to seaports in Texas, Trump has similarly promised to preside over a major expansion in oil and gas drilling across the United States.
With a few exceptions—the price war with OPEC chief among them—American oil and gas has boomed under President Obama. Hydraulic fracturing has allowed producers to tap gas reserves that were previously inaccessible, allowing the U.S. to become more and more self-sufficient in energy production. The EIA expects the country could become a net energy exported by 2026.
That’s ultimately bad news for the Canadian oil industry. While oilpatch business leaders have been cautiously optimistic about a Trump presidency, it would also mean more oil and gas production in a country that is Canada’s largest customer for petroleum products. Trump has also promised to roll back regulations at a time when Canadian provinces are being instructed to pay a price for carbon emissions and seek “social licence” for energy projects.
That has some saying Canada should abandon its climate plans or risk losing what remains of its oil and gas industry.
Not everyone agrees.
Writing in the Globe and Mail, former B.C. Premier Gordon Campbell argues that Canada can continue to be an economic and environmental leader. While he does not explicitly address Trump, Campbell says B.C.’s experience with the carbon tax shows economies can grow even when competing jurisdictions lag on environmental regulation.
Borrowing an oilpatch analogy, former Reform Party leader Preston Manning argues that political leaders need to drill “relief” wells to prevent a populist blowout. With Trump-style populism gaining strength in Alberta, some say a pipeline is needed to let off steam. Writing in the National Observer, Sandy Garossino contends that the TransMountain pipeline is a concession necessary for stronger emissions regulations.
Garossino claims that approving the TransMountain pipeline is a trade-off needed in exchange for the stricter environmental regulations and carbon pricing brought in by the Notley and Trudeau governments. Blocking pipelines activism should not be the sole measure of successful climate action she says—especially when it imperils political leaders who acknowledge the seriousness of the climate change threat.
“Rachel Notley staked her political future on a serious carbon tax and hard cap on tar sands emissions,” Garossino writes. “After she sacrificed political capital to support the environment, do B.C. environmentalists have her back? Nope.”
“Nobody should fool themselves for a second that political forces that would take us backward aren’t gathering and planning their next moves,” she continues. “Just look south of the border if you doubt it. Because progressive support fragmented . . . American leadership on climate change is about to evaporate.”
Jonny Wakefield, 12 January 2017