Picture this: It’s 2035 and Canada is well on its way to reaching its climate goals.

The country’s power system is almost entirely clean – hydro and nuclear, and wind and solar. Natural gas has dwindled. Domestic oil demand is also down a lot, as electric vehicles – a government-subsidized curiosity back in 2022 – are commonplace.

But this picture of 2035 might also surprise: Canada still produces a lot of oil and gas – and remains a top exporter of both fossil fuels.

The policy and legal foundations for this potential future go back to the late 2010s. Of particular note was what happened in 2018: Ottawa imposed an economy-wide and escalating price on carbon; invested many billions in the export-capacity boosting Trans Mountain oil pipeline and expansion; and, with little public attention, started drawing up new climate rules for reviews of proposed industrial projects, dubbed the strategic assessment of climate change.

Some said it was contradictory for Canada to aim to slash greenhouse gas emissions at home, while continuing to sell volumes of gas and oil – the latter a source of national wealth that accounted for one-seventh of the country’s exports.

This spring, 2022, the many details of how to make these two big goals real started to take clearer shape.

Ottawa’s latest plan to reduce emissions landed in late March. It sketched out aggressive cuts in oil and gas emissions – but not production. The hope is to transform Canada’s relatively dirty oil sands into something relatively far better. In early April’s budget, there was $7.1-billion through 2030 to split the cost with industry to build up carbon capture.

On April 6 came another policy puzzle piece, and two examples of how more oil can – and can’t – work.

Seeing a global market that will in years ahead move away from fossil fuels, Ottawa is working on standards for “best-in-class” projects “to transform Canada into the cleanest global oil and gas producer.”

That’s why Ottawa approved the Bay du Nord offshore project in Newfoundland, which could start pumping oil in 2028, with peak production of 200,000 barrels a day. Per-barrel emissions would be low. At the same time, Ottawa told Suncor much more work was required on its plan to mine new ground, and 225,000 barrels of bitumen a day, in the oil sands in 2030, as old mines tap out.

Suncor’s initial submission included hefty climate-heating emissions of three megatonnes of carbon a year – about 12 times that of Bay du Nord. Ottawa told Suncor the plan would likely be rejected; Suncor asked for more time to come up with a smarter, lower-emission plan.

Ottawa’s response to Suncor and Bay du Nord – an openness to new oil projects, if they meet reasonable yet top-tier climate standards – is the right approach.

This is the bargain and the reality: Canada can only affect demand within its borders. That’s the basis of international climate deals from Kyoto onward. We need to hammer down domestic use of fossil fuels, but so long as global demand continues, Canada should have no qualms about capturing an ever greater share of it – while aiming to make this country’s oil the world’s least polluting.

In the International Energy Agency’s reckoning of net zero in 2050, the world will use a quarter of the oil it does today, and half the gas. The industry will shrink. Competition will intensify. For Canada, getting ready, and fast, is essential.

It’s time to get more ambitious. The oil sands in large part exist because of government support. Back in the 1960s, Suncor was the first miner of the vast expanses of bitumen on the banks of the Athabasca River. This was a lead-gold alchemy, turning tarry muck into synthetic oil to be refined into gasoline. Canada showed real tech savvy.

Let’s do it again. The oil sands industry promises net zero in 2050. Why not 2040?

This sort of politics isn’t easy to talk about today. Conservatives shout that Liberals are anti-oil, which isn’t quite true. But the Liberals mostly want to talk about climate – their brand – and not how important the oil industry is to our economy. The way forward, for a country built on natural resources, is in the difficult middle ground.

Picture this: It’s 2035, and Canada uses barely any fossil fuels at home and still exports a bunch of oil and gas. And the oil sands are five years – not 15 – away from net zero.

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