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OTTAWA – Oil and gas producers in Canada will be required to cut greenhouse gas emissions by about one-third over the next eight years under new regulations published Monday.

The government is also going to establish a cap-and-trade system that Environment Minister Steven Guilbeault said will reward lower-emitting producers and incentivize higher-polluting ones to do more.

The regulations, which are still only in draft form and about two years behind schedule, were met with dismay from industry leaders and are further straining relations between Ottawa and the Alberta government.

Alberta Premier Danielle Smith called the measures “unrealistic targets” and said her government would act quickly to challenge the regulations in court. She accused Guilbeault of having a vendetta against Alberta.

For the Liberals, the regulations fulfil a 2021 election promise to force the energy sector to pull its weight in the fight against climate change.

“We’re asking the oil and gas sector to invest their record profits into pollution-cutting projects. Projects that can create and keep good jobs,” Guilbeault said at a press conference in Ottawa.

He said the oil and gas industry is a major source of emissions, but it has done less than most other sectors to reduce them.

“I think most Canadians — even those that aren’t my biggest fans — would agree that it’s not OK for a sector to not be doing its share, and that’s mostly what this regulation is about,” Guilbeault told The Canadian Press in an interview ahead of the announcement.

Upstream oil and gas operations, including production and refining, contributed about 31 per cent of Canada’s total emissions in 2022.

The regulations propose to force upstream oil and gas operations to reduce emissions to 35 per cent less than they were in 2019, by sometime between 2030 and 2032.

Emissions from the sector already fell seven per cent between 2019 and 2022 — the most recent year that statistics are available — with similar levels of production.

The cap does not dictate what companies must do to meet the target, but Guilbeault said the government’s modelling suggests about half the cuts will come from reductions to methane. Those cuts are already happening as oil producers install equipment to prevent the leaks of methane that were a major contributing source of emissions.

The rest will be divided between various technologies, including carbon capture and storage. Ottawa is expected to spend about $12.5 billion on a tax credit to encourage and assist companies to invest in those systems that trap carbon dioxide and return it to underground storage.

Under the proposed cap-and-trade system, each company will be given an emissions allowance equating to one unit per tonne of carbon pollution.

Companies that pollute less will be able to sell their leftover allowance units for profit, while companies that don’t reduce their emissions enough will have to buy allowance units from other companies to stay in compliance.

The idea is to get companies to invest in carbon-reduction technologies in order to curb their emissions without having to reduce their production.

But Monday’s announcement was met with skepticism from industry stakeholders who warned such a measure would harm the sector.

The Canadian Association of Petroleum Producers — which represents companies responsible for three-quarters of Canada’s annual oil and natural gas production — said the proposed changes would deter investment and negatively impact jobs in the sector.

“Our members believe the draft emissions cap regulations, if implemented, are likely to deter investment into Canadian oil and natural gas projects,” said the association’s president Lisa Baiton.

“The result would be lower production, lower exports, fewer jobs, lower GDP, and less revenues to governments to fund critical infrastructure and social programs on which Canadians rely.”

Natural Resources Minister Jonathan Wilkinson said the government’s modelling shows the plan is both feasible to hit emission targets, and viable for the sector.

“When we brought in the initial methane regulations, the industry also said ‘This isn’t very good’ and what it did was it actually created a lot of jobs in technology development and deployment,” Wilkinson told The Canadian Press.

“Alberta now exports that technology to other countries around the world that are following in Alberta’s footsteps.”

Guilbeault said federal modelling shows even with the regulations, oil and gas production will rise 16 per cent by 2032, compared with 2019. He said the government landed on the cap’s amount based on extensive discussions about what was possible to regulate without forcing down production.

He also said reducing emissions from Canada’s oilpatch is the only way Canadian oil will remain competitive in a world that is increasingly looking for the greenest option available.

“In a carbon-constrained world, people who will still be demanding oil will be demanding low-emitting oil,” he said. “And if our companies and our oil and gas sector isn’t making the investments necessary to do that, they won’t be able to compete in this world.”

Conservative Leader Pierre Poilievre has vowed to scrap the emissions cap regulations. In a statement Monday, the Conservative Party said the measures would “raise the cost of energy and send billions of dollars to dictators overseas.”

Senior government staff, however, emphasized oil prices are subject to global markets and insisted the measures will increase the demand for Canadian oil as markets seek cleaner products.

The regulations won’t be finalized for months and are expected to come into force in 2026 — after the next federal election.

This report by The Canadian Press was first published Nov. 4, 2024.

WINNIPEG – A teepee and a sacred fire were set up in front of the Manitoba legislature on Monday to honour Murray Sinclair, as tributes poured in from across the country for the former judge, senator and chair of the Truth and Reconciliation Commission into residential schools.

People lined up under grey skies, facing a cold wind, to enter the teepee and pay respects. Flags nearby flew at half-mast.

Sinclair died in a Winnipeg hospital Monday morning. He was 73.

“I think we can truly say he was one of the key architects of the era of reconciliation,” Premier Wab Kinew said.

“As we begin to mourn his loss … I think we have to contend with the ultimate question of, now that we’ve been left to ourselves as Canadians, how are we going to take it from here?”

Kinew joined Sinclair’s family and community members in setting up the large teepee, which he said is an important part of Anishinaabe culture. Kinew had known Sinclair since the premier was a child.

“The sacred fire is a gathering place for mourners. And significantly, what it represents in our culture is the offerings that Murray will need in order to be successful on his four-day journey along the everlasting road to the afterlife.”

Sinclair’s family issued a statement and they invited people to visit the fire.

“Mazina Giizhik (the One Who Speaks of Pictures in the Sky) committed his life in service to the people: creating change, revealing truth, and leading with fairness throughout his career,” said the statement, noting Sinclair’s traditional Anishinaabe name.

Prime Minister Justin Trudeau paid tribute in Ottawa to Sinclair’s work on reconciliation.

“To me he was a teacher, a challenge function, a guide, an elder, a sage and a friend as he helped me and this country navigate through something that we will be navigating through for decades still,” Trudeau said.

Born in 1951, Sinclair was raised on the former St. Peter’s Indian Reserve north of Winnipeg. He was a member of Peguis First Nation.

He was raised by his grandparents and graduated from a high school in Selkirk, Man., where he excelled in athletics.

Some of his earliest childhood memories were published earlier this year in his memoir, “Who We Are: Four Questions for a Life and a Nation.”

In it, Sinclair described discrimination he experienced being Anishinaabe in a non-Indigenous school.

“While I and others succeeded in that system, it was not without cost to our own humanity and our sense of self-respect. These are the legacies all of us find ourselves in today.”

In 1979, Sinclair graduated law school at the University of Manitoba and later became the first Indigenous judge in Manitoba — the second in Canada.

He served as co-chair of the Aboriginal Justice Inquiry of Manitoba to examine whether the justice system was failing Indigenous people after the murder of Helen Betty Osborne and the police shooting death of J.J. Harper.

In leading the Truth and Reconciliation Commission, he participated in hundreds of hearings across Canada and heard testimony from thousands of residential school survivors.

The commissioners released their widely influential final report in 2015, which described what took place at the institutions as cultural genocide and included 94 calls to action.

“Education is the key to reconciliation,” Sinclair said. “Education got us into this mess and education will get us out of it.”

Two years later, he and the other commissioners received the Meritorious Service Cross for their work.

It was one of many recognitions Sinclair received over his career.

He was given a National Aboriginal Achievement Award, now the Indspire Awards, in the field of justice in 1994. In 2017, he received a lifetime achievement award from the organization.

In 2016, Sinclair was appointed to the Senate. He retired from that role in 2021.

The following year, he received the Order of Canada for dedicating his life to championing Indigenous Peoples’ rights and freedoms.

In accepting that honour, Sinclair said he wanted to show the country that working on Indigenous issues requires a national effort.

“When I speak to young people, I always tell them that we all have a responsibility to do the best that we can and to be the best that we can be,” he said.

Sinclair limited his public engagements in recent years due to declining health.

In his memoir, Sinclair described living with congestive heart failure. Nerve damage led to him relying on a wheelchair.

In his memoir, released in September, he continued to challenge Canadians to take action.

“We know that making things better will not happen overnight. It will take generations. That’s how the damage was created and that’s how the damage will be fixed,” Sinclair wrote.

“But if we agree on the objective of reconciliation, and agree to work together, the work we do today will immeasurably strengthen the social fabric of Canada tomorrow.”

This report by The Canadian Press was first published Nov. 4, 2024.

OTTAWA – The federal government has published new draft regulations that will force oil and gas companies to slash their greenhouse gas emissions.

Here’s what that looks like, and what it might mean for the industry and for Canada’s climate targets:

1. What is an emissions cap and what does it target?

The government is essentially proposing to put a limit on how much oil and gas producers can pollute with greenhouse gas emissions. Those producers together account for 31 per cent of Canada’s total emissions.

Under the proposed regulations, those producers would be required to cut their emissions by about one-third below 2019 levels over the next eight years.

2. What are the oil and gas industry’s current emissions?

In 2022, the most recent year for which Canada’s emissions data is available, oil and gas production and refining emitted 256 million tonnes of carbon dioxide or its equivalent weight in other gases, including methane.

Emissions from the oil and gas sector have gradually declined since a peak in 2014, according to government data, representing a roughly 12 per cent reduction. The 2022 emissions are about on par with 2007 levels.

3. Can the industry meet the regulations without cutting production?

According to the government, it can — which is paramount to the entire proposal.

The government is pitching a cap-and-trade system as part of the proposed changes. In essence, companies will be given an emissions allowance equating to one unit per tonne of carbon pollution.

Companies that pollute less will be able to sell their leftover allowance units for profit, while companies that fail to reduce their emissions enough will have to buy allowance units — a maximum of 20 per cent of their emissions cap — from other companies to stay in compliance.

4. What would the industry do to meet the cap?

The government is hoping oil and gas companies reinvest their profits in technology that reduces greenhouse gas emissions without cutting their production.

Some of those initiatives include carbon capture technology, an area that some of Canada’s producers are already investing in. For instance, Shell announced in June it was launching two new carbon capture projects in Alberta. Both are expected to be operational by 2028.

Producers could also buy offset credits from decarbonization projects outside the oil and gas industry — like tree-planting programs — to be cap-compliant. Those credits can only be the equivalent of up to 10 per cent of their emissions cap.

5. What do the industry and environmental groups say about the proposed regulations?

Monday’s announcement was met with skepticism from Canada’s leading oil producers.

The Canadian Association of Petroleum Producers — which represents about three-quarters of Canada’s oil and natural gas production — warned the cap would likely deter investment in Canadian oil and gas products, resulting in lower production and fewer jobs, and would hurt Canada’s GDP.

Environmental Defence, one of Canada’s leading environmental advocacy organizations, welcomed the proposed changes but called for them to be implemented sooner and for the government to close “loopholes” like allowing offset credits.

This report by The Canadian Press was first published Nov. 4, 2024.

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