Costly, Divisive, Pipelines are the Worst Investment as Oil and Gas Demand Set to Peak

Independence from foreign powers like the U.S. and China is a question of renewable growth, not oil and gas expansion.

Media statement and important factors for consideration below: January 29th, 2025.

News articles on Trump and Oil and Gas Corporations

The spread of misinformation about the reality of climate change and the viability of different energy sources is undermining Canada’s energy future. This misinformation is also dividing Canadians as with the undermining of local democracy in Alberta in the interest of coal expansion (recently reported by The Tyee). There is additionally a concerning overlap between climate denialism and ’51st State’ rhetoric.

The recent tariff threat from the new U.S. Administration has a few commentators and some elected leaders wondering about the viability of constructing new pipelines and East Coast LNG export infrastructure to try and decrease reliance on the U.S. market. It’s a familiar argument which we seem to hear in response to every global crisis – suggesting that ‘things will get better if we just build more oil and gas infrastructure.’

There is a desperate need to help ensure new employment options exist in oil and gas dependent regions such as Alberta and Newfoundland and Labrador. But chasing doomed projects helps no one and distracts from real solutions.

Here is a list of reasons why the argument for new pipelines and LNG facilities is flawed and inherently divisive:

  • New pipeline and LNG projects, even if started tomorrow, would take years to get online – meaning they would provide no immediate relief to tariffs.
  • Oil and gas demand globally is set to peak this decade meaning by the time any new LNG or oil infrastructure was brought online it would not have a market making it a waste of resources and time.
  • Already most LNG and pipeline projects that have failed have failed because of there being a lack of a business case for the projects or because of local or provincial opposition to the projects. There is also an increasing lack of private investment interest in oil and gas expansion – even in the U.S. and regardless of Trump’s new policy direction.
  • Oil and gas companies in Canada are seemingly uninterested in new projects.
  • Renewable energy projects can be localized, but LNG export and pipeline projects by their very nature must cross multiple jurisdictions to function and will inevitably cause backlash and division in process. Communities will continue to oppose LNG and oil projects because they are often hazardous locally and certainly hazardous to our climate.
  • LNG export facilities increase domestic costs and exported LNG is often stalling progress towards renewable energy internationally, not decreasing coal usage.
  • U.S. tariffs are also not the only determining factor in the viability of pipeline and LNG projects: 

– The U.S. President has already called for a lowering of oil prices – a move that ironically contradicts his own case for oil and gas expansion in the U.S. and also weakens the case for expansion in Canada. Meanwhile the predicted power demands of AI are already in doubt.

– This signals we are likely in for a volatile future for oil and gas heavily influenced by a powerful U.S. leader who does not actually seem to understand energy policy.

– Other global events and powers also influence oil and gas prices and demand and doubling down on large scale singular pipelines and LNG projects would increase that exposure.

– The risk here being that unless Canada develops independent renewable supply chains rapidly we may well find ourselves at a disadvantage to both the U.S. and China in terms of energy and employment independence.

Renewable energy is a better basis for employment and for keeping energy benefits in Canada. Powering any data centres, in Canada where they can be better regulated, with renewable energy is also a far better way forward than using oil and gas to meet that energy need and would likewise create more jobs.

While there are renewable solutions to strengthening energy and employment independence in Canada that can be implemented rapidly, investing in oil and gas export infrastructure represents an economic dead-end. New pipelines and LNG only offer division.

“We have domestic renewable solutions for when the wind does not blow or the sun does not shine like energy efficiency and storage, diversified renewables, and interconnecting grids,” says Conor Curtis, Head of Communications at Sierra Club Canada. “We cannot control global oil and gas prices and oil and gas dependency leaves us exposed to the whims of hostile leaders and corporate profiteering.”

Oil and gas dependency is already hurting Canadians’ wallets. As of 2023, for every additional dollar of inflation in Canada 25 cents was going to oil and gas and mining extraction profits.

“Trump has attempted to hand the fossil fuel industry a huge win in pulling the U.S. government out of renewables. But amid low investor interest in long term oil and gas projects Trump is really only handing a victory to China, which is quickly working to corner global clean energy supply chains. If Canada wants to maintain energy stability and independence from both the U.S. and China, then we must compete in the renewable energy development of the future, not the oil and gas development of the past.”

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