Who would have thought?
Over the next seven to 10 years, Canada could offset upwards of 59% of Russia's annual natural gas exports and 46% of its crude oil exports, amounting to 7.72 billion cubic feet per day (BCF/D) and 1.85 million barrels per day (BPD), respectively.
After Russia invaded Ukraine in February 2022, many observers noted that the Kremlin's natural gas and oil exports funded the tanks and rockets, inflicting death, pain and suffering on the Ukrainian people.
According to the Paris-based International Energy Agency (IEA), oil and gas revenues comprised approximately 45% of Russia's federal budget in 2021.
SecondStreet.org president Colin Craig contends that Russia has created what is likely to be a long-term problem and that the world needs to ease off Russian energy.
The report articulates that even if Russia pulled its forces out of Ukraine, it would be irresponsible to purchase Russian energy as usual and unwise to believe that Russia's military aggression concludes with Ukraine.
“Canada could take a big bite out of Russia's military funding by stealing many of Putin's oil and natural gas customers,” said Craig. “It can't happen overnight, but we must remember, the world is facing a long-term problem with Russia.”
In the immediate future, Canada could offset 4% of Russian natural gas exports and 6% of crude oil exports.
Still, the limitations on pipeline capacity and the reality that new energy projects take longer than a year to get off the ground remain a continued concern.
Canada's controversial Bill C-69, the Impact Assessment Act, has given Canadian and international investors a hard time getting shovels in the ground on their projects, even after securing regulatory approval.
As of 2020, Canada has lost $150 billion in energy investment opportunities since Trudeau first became prime minister, which would have generated taxes, jobs and businesses for the domestic economy.
“It's great for consumers that alternative energy sources such as wind, solar and hydrogen power are emerging and growing,” added Craig. “However, they're still a very small percentage of global energy and the world is expected to continue using oil and natural gas for decades.”
The International Energy Agency projects Russia's role as a dominant energy player to diminish even without Canada increasing oil and natural gas exports to address the situation.
The IEA's World Energy Outlook 2022 report projects that the petrostate's share of internationally traded gas will fall from 30% to between 10–15% by 2030. Russia's oil exports are projected to fall by 25% over the same period.
Craig argues that the time is now for Canada to step up and be an “ethical, dependable supplier” on the world stage.
A new Leger poll conducted for Second Street confirmed that Canadians want to help.
The poll of 1,535 Canadians found 72% of respondents either “somewhat” or “strongly” supported “developing and exporting more oil and natural gas resources so that the world can reduce how much it purchases from Russia.”
Support is widespread across Canada, including men and women and all age groups, though support remains weakest in the federal government.
Craig expressed his frustration with the Trudeau Liberals taking their “marching orders” from the 13% of Canadians who are either “strongly” or “somewhat” opposed to exporting more oil and natural gas.
Despite considerable pushback from business leaders, Prime Minister Trudeau recently claimed there has “never been a strong business case” for exporting natural gas from Canada's east coast to Europe.
However, the poll shows Canadians are more than three times more likely to agree with the industry.
“Getting new energy projects underway can take time — it would take years, even if governments fast-tracked approvals,” adds Craig.