Grant Bishop is an associate director, research, at the C.D. Howe Institute.
My flight back west was delayed at Toronto’s Pearson Airport, and I got talking to a Calgary banker, who was also homeward bound after a circuit around Bay Street. “Capital is thin right now,” she said. “Upstream investment for Canadian oil and gas is just a no-go: It’s not a matter of risk premium. No one knows how to price the politics.”
Investment in Canada’s resource sector fell dramatically in the past four years and the outlook for new projects remains depressed. Ottawa has proposed an overhaul under Bill C-69 of the federal environmental assessment for major capital projects, and our Senate is now scrutinizing the legislation.
In a report published on Thursday by the C.D. Howe Institute, Alberta’s former deputy minister of energy Grant Sprague and I aimed to add data and detail to this policy discussion. We believe that, in its present form, Bill C-69 risks amplifying political risk and further impairing confidence in Canada’s resource sectors.
It also doesn’t address Ottawa’s past failures to adequately consult Indigenous peoples, which resulted in the Federal Court of Appeal quashing cabinet’s approvals of the Northern Gateway and Trans Mountain expansion pipeline.
First, our report highlights the downdraft to investment in our natural-resources sectors. Since 2014, annual capital investment in these sectors has fallen by $50-billion – equal to roughly 20 per cent of capital spending across all Canadian industries.
For the rest of this column: https://www.theglobeandmail.com/opinion/article-the-flawed-bill-c-69-will-worsen-rather-than-solve-the-crisis-in/