Fossil fuels remain key to Canada’s economy and security

Written by ECA Review

Six years ago, I asked energy companies and others to fund research on why, in addition to being valuable economic commodities, oil and natural gas might be integral to Canada’s and our allies’ security interests.

My theory was that Canadians who usually think only superficially about fossil fuels might be more sympathetic to their development if they grasped how dangerous it was for our allies to rely as heavily as they do on imports of natural gas and oil from autocracies and tyrannies.

There was little interest. 

Energy CEOs seemed convinced that opposition to Canadian oil and gas could be overcome with numbers arguments alone, emphasizing how profitable the sector is for Canada in terms of jobs, incomes and tax revenues.

That was a mistake. 

Too many Canadians, then as now, believed in either-or choices on oil and gas: Either keep pumping ‘dirty’ energy or give that up and move into a bright green future.

That was always simplistic, but it made consideration of the economic benefits of fossil fuels seem crude compared to the romantic visions of a pure, pre-industrial world offered up by deep greens.

Now, tragically, energy security is a dominant headline, given Russia’s invasion of Ukraine and the folly of Europe’s dependence on Russia for too much of its energy use. That dependence has increased steadily over the past two decades as Europeans shut down nuclear and electrical generation coal plants and discouraged new oil and gas exploration on their continent.

The result of such policy follies is that Russian President Vladimir Putin has dangerously increased his leverage over Europe, now highly dependent on foreign natural gas and oil, much of it coming from tyrannies and autocracies.

For example, between 2005 and 2019, members of the European Union imported over €838 billion in natural gas from foreign sources, or an average of nearly €56 billion a year. About one-third of that came from tyrannies and autocracies (mainly Russia, Algeria and Libya) – “not-free” countries in the terminology of Washington-based think-tank Freedom House – with the rest from “free” countries (liberal democracies) and “partly free” countries.

By 2019, however, the proportion of Europe’s imported natural gas from not-free countries had risen to 41 per cent – although that’s likely an underestimate, as Germany doesn’t release all its data on fossil fuel imports from Russia.

The EU is even more dependent on autocracies and tyrannies for oil imports. Between 2005 and 2019, it imported €4.6 trillion in foreign oil, with 68 per cent or €3.1 trillion worth coming from countries not considered democratic or free. 

In 2019, the share was down only slightly, to 67 per cent. (These data are from the Canadian Energy Centre*, where I co-authored several reports on the oil and natural gas exports of repressive regimes worldwide.)

Russia accounts for 58 per cent of the natural gas and 42 per cent of the oil that the EU bought from tyrannies and autocracies between 2005 and 2019.

It’s time for Canadians to end their magical thinking about energy. That includes dropping the fantasy that we can realistically reduce carbon emissions to net-zero by 2050.

*The Canadian Energy Centre Limited (CEC), also commonly called the “Energy War Room”, is an Alberta provincial corporation mandated to promote Alberta’s energy industry and rebut “domestic and foreign-funded campaigns against Canada’s oil and gas industry”.

 

by Mark Milke, President

The Aristotle Foundation*

* The Aristotle Foundation is a U.S.-based foundation that provides consulting for political campaigns, public affairs and data since 1983.

About the author

ECA Review