Prime Minister Justin Trudeau is in the heart of the U.S. oilpatch to make the case for investing in Canadian natural resources, even while his Liberal government is preparing for a future without fossil fuels.
“Nothing is more essential to the U.S. economy than access to a secure, reliable source of energy,” Trudeau said Thursday night in Houston during a keynote address to an influential global gathering of politicians and energy sector executives.
“Canada is that source.”
The two-day trip is the first time a Canadian prime minister has attended the annual CERAWeek conference, which brings more than 3,000 people — including legislators, energy executives, innovators and experts — from around the world.
Trudeau talked up the connection between resource development and taking care of the environment, a message he has also been taking to Canadians — including those who still had bitter memories of the national energy program his father, former prime minister Pierre Trudeau, implemented in the 1980s.
“It was a failure,” said Trudeau in an advance copy of his speech that was, at times, self-deprecating and folksy in tone.
Trudeau has been trying to convince skeptics on both sides of the political spectrum that he will get it right this time, and that the country needs both new pipelines and a carbon-pricing plan meant to cut back on greenhouse gas emissions.
The conference, organized by London-based research firm IHS Markit, also gave Trudeau an award for his stance in favour of sustainable development.
Trudeau noted his government approved two pipelines — Trans Mountain’s Kinder Morgan line and Enbridge’s Line 3 rebuild — and welcomed the news that U.S. President Donald Trump wants to move ahead with the Keystone XL pipeline project that TransCanada proposed nearly a decade ago.
“I make no bones about it: We’re proud of this. It’s progress. It’s important,” said Trudeau.
But he argued that other things are important too.
“There will come a day, far off but inevitable at some point, when traditional energy sources will no longer be needed,” said Trudeau, who positioned Canada as a leader on clean energy technologies such as carbon capture and better batteries for electric cars.
“Let me be very clear: We could not have moved on pipelines had we not acted on climate,” Trudeau said.
The visit comes at a time when the energy industry, buoyed by a recent resurgence in the price of oil, and governments around the world are grappling with a dramatic shift in American politics.
Barack Obama, the former U.S. president, had emphasized the global fight against climate change as he neared the end of his time in the White House.
Trump, though, has vowed to boost fossil fuel production through easing regulations. That stance, and his tough-on-trade approach could challenge Trudeau’s vision for a clean-energy future.
The Conservatives have been highly critical of the Liberal plan to require all provinces and territories to have some form of carbon pricing in place by then, with Mark Strahl, their natural resources critic, suggesting that is frightening foreign investors away.
“All they’re looking at is cost-certainty and the break-even price per barrel, and when you increase the costs on any sector like the government of Canada is doing, you risk becoming uncompetitive.”
Thursday brought news of more international energy giants abandoning the Canadian oilsands: Netherlands-based Royal Dutch Shell and Houston-based Marathon Oil are selling their stakes to Canadian Natural Resources for $12.74 billion in cash and shares.
The move shows that at a time of lower crude prices, and the quick growth of less costly shale oil, foreign companies are taking another look at their investments in the costly and carbon-intensive Alberta oilsands.
Trudeau’s visit is part of ongoing Liberal government efforts to convince the Trump administration and other American legislators that keeping an open border benefits the economy — including the energy sector — in both Canada and the U.S.
On Friday, the prime minister is scheduled to meet with Greg Abbott, the governor of Texas, and Lisa Murkowski, the U.S. senator for Alaska. Both are Republicans. David MacNaughton, Canada’s U.S. ambassador and a key player in the government’s outreach efforts, is also part of Trudeau’s entourage in Houston.
Natural Resources Minister Jim Carr, who has been in Houston all week, said the federal government believes that, in the long run, investors will see the Canadian oil and gas industry as a good place to put their money as they transition to renewable energy.
“There will be other investors who see Canada, known for its innovation and its entrepreneurship, as a place where investment makes a lot of sense,” Carr told reporters Thursday evening.