Premier Smith meets with Trudeau, says she will not 'phase out' Alberta energy

The Canadian Press / Sean Kilpatrick

Alberta Premier Danielle Smith has informed Prime Minister Justin Trudeau that she would not phase out her province's energy sector amid calls for a "just transition."

Trudeau and Smith briefly met for a 30-minute media availability before their meeting on healthcare, with Smith highlighting the apparent tension between Alberta and the federal government.

Smith noted Tuesday she had extended the olive branch to the prime minister on January 25 to develop "sustainable jobs" legislation together and abandon his pursuit for a "just transition." 

She wrote that Alberta and Ottawa must work together because now they are at a "crossroads" over constitutionally-derived jurisdiction.

"Operating in political silos, as adversaries on this issue, is getting us nowhere, and I believe all Canadians are tired of seeing it."

"[It] gives the impression that the energy sector is going to be phased out; it's not going to be phased out," added Smith.

"Albertan energy workers and workers in general have been extraordinarily important for the success of Canada over many, many decades, and we need to make sure they continue to be strong into the future as well," said Trudeau during the media availability.

Natural Resources Minister Jonathan Wilkinson said on February 1 that the federal government would show Canadians its plan to transition to a net-zero economy by the end of March. However, it may "slip into the next quarter."

Wilkinson clarified that the 'just transition' bill would be secondary to the action plan listing what the feds intend to do.

Smith told Trudeau in her letter the proposed transition "threatens the national economy," the livelihood of hundreds of thousands of workers, and business investments.

A leaked federal memo foreshadowed that transitioning to a low-carbon economy would "have an uneven impact across sectors, occupations, and regions and create significant labour market disruptions."

Per the memo, The feds would expect "larger-scale transformations" that would cost 13.5% of Canadians and 187,000 Albertans jobs in agriculture, energy, manufacturing, transportation and construction.

The meeting centred on Smith's request to halt the "just transition" and instead focus on a plan to attract investors and workers in the conventional and non-conventional sectors while reducing emissions.

She said her government's approach to reducing carbon emissions would involve utilizing carbon capture and storage, among other technologies.

According to a readout of the meeting, Trudeau expressed a "willingness" to explore this strategy.

"Canada should be the world's greatest energy superpower. It can be if we come together collaboratively in pursuit of that objective. There is no limit to our nation's potential," claimed Smith. 

"The world needs more Canadian energy, not less."

Alberta's premier pressed on the importance of Canadian energy security in her letter and on lessening the global dependency on "undemocratic" countries with "atrocious environmental records" to supply the energy demand.

The International Energy Agency (IEA) expects crude demand to climb to a record this year even as Canada sets a new oil production high, despite pipeline constraints and government environmental policies.

In its latest Oil Market Report, the Paris-based IEA expects global oil demand to rise 1.9 million barrels per day (BPD) to a record 101.7 million BPD in 2023, with nearly half of the increase coming from China following the lifting of its COVID restrictions.

According to the Alberta Energy Regulator (AER), Canada hit an annual production record for a second straight year despite pipeline constraints and government environmental policies. Canadian oil output hit a record 4.5 million BPD in 2022 — the fifth largest in the world — with 3.7 million BPD coming from Alberta.

"Simply put, the world needs more Canadian energy and technology, not less," said Smith. "As the owner of the world's third-largest oil and gas reserves and the most advanced environmental technology on the planet — we need to signal our intention to provide substantially more of both."

"The federal government must stand shoulder to shoulder with Alberta to reduce emissions and continue to responsibly develop our oil and natural gas and future energy sources while also positioning Canada as the optimal solution to global energy needs and security."