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Canadian Energy in Multiple Crises: From Pipeline and Climate to Covid-19Pierre-Olivier PineauHEC Montréal, CanadaApril 15, 2020
Webinar Outline
1. Canada’s Energy Sector: Production & Consumption2. Energy Crises in Canada:
• Oil prices• Pipelines• Regulatory / First Nations / Social licence• Climate & GHG reduction paths• Other: LNG, hydro, transmission lines
3. Sustainable Paths
2
1. Canada’s Energy Sector: Production & Consumption
3
Top 10 - World Energy Producers, 2017
4
0
20
40
60
80
100
120
PR China US Russia Saudi Arabia India Canada Indonesia Iran Australia Brazil
Mill
ions
Biofuels and wasteSolar/wind/otherGeothermalHydroNuclearNatural gasCrude & NGLCoal and coal products
IEA (2020)
Mill
ion
Tera
joul
e(T
J)or
Exa
joul
e (E
J)
Per Capita Production, Total Primary Energy Supply and Total Final Consumption, 2017
558
433
122
4
0
100
200
300
400
500
600
700
800
900
PR China US Russia Saudi Arabia India Canada Indonesia Iran Australia Brazil
GJ p
er c
apita
Production per capita (GJ)TPES per capita (GJ)Total Final Consumption per capita (GJ)
IEA (2020)
World Average78.277.854.1
Per Capita Total Final Consumption Breakdown, Countries >5 million people, Top 10, 2017
60
50
100
150
200
250
UAE Canada US Finland Singapore Saudi Arabia Norway Belgium Korea Netherlands World
Non-Energy UseOtherAgricultureCommercialResidentialTransportIndustry
IEA (2020)
224
GJ p
er C
apita
Canadian Oil Production: 4.6 Mb/d, 2018
7NRCan (2020)
SuncorCanadian Natural Resources
Imperial Oil (ExxonMobil)Husky
Cenovus
> 50%Total Production
Oil & Gas Production in AlbertaMonthly, 2007-2020
8Alberta Government (2020)
0
50 000
100 000
150 000
200 000
250 000
300 000
350 000
400 000
450 000
0,0
0,5
1,0
1,5
2,0
2,5
3,0
3,520
07-0
1
2007
-07
2008
-01
2008
-07
2009
-01
2009
-07
2010
-01
2010
-07
2011
-01
2011
-07
2012
-01
2012
-07
2013
-01
2013
-07
2014
-01
2014
-07
2015
-01
2015
-07
2016
-01
2016
-07
2017
-01
2017
-07
2018
-01
2018
-07
2019
-01
2019
-07
2020
-01
Mill
ion
Cubi
c Fe
et (p
er M
onth
)
Mill
ion
Barr
els p
er D
ay
Conventional Oil
Oil SandsNatural Gas
Energy SectorGDP by Province2016
by Provincial Share of Canadian GDP, 2016
andEnergy Sector Share of Provincial GDP, 2018
9Statistics Canada (2020)
NL
PENS
NB
Quebec
Ontario
MB
SK
Alberta
BC
0%
5%
10%
15%
20%
25%
0% 10% 20% 30% 40% 50%
Ener
gy S
ecto
r % o
f Pro
vinc
ial G
DP
Provincial Share of Canadian GDP
2014 $110B
2016 $49B
2. Energy Crises in Canada
10
Oil Prices: A Double Price Crisis, 2014-2020
11
$0
$20
$40
$60
$80
$100
$120
2014
/06
2014
/08
2014
/10
2014
/12
2015
/02
2015
/04
2015
/06
2015
/08
2015
/10
2015
/12
2016
/02
2016
/04
2016
/06
2016
/08
2016
/10
2016
/12
2017
/02
2017
/04
2017
/06
2017
/08
2017
/10
2017
/12
2018
/02
2018
/04
2018
/06
2018
/08
2018
/10
2018
/12
2019
/02
2019
/04
2019
/06
2019
/08
2019
/10
2019
/12
2020
/02
US$
/bbl
West Texas IntermediateWestern Canadian SelectWTI-WCS
Alberta Government (2020)
Recent low:March 30th
2020:WTI $20.09WCS $4.69
12CAPP (2019)
Pipelines &Refineries
Pipelines: Western Canada Takeaway Capacity vs. Supply Forecast, 2015
13CAPP (2015)
DelayedDelayed20192015
Regulatory Crisis: Assessment of Infrastruture Projects• Bill C-69 An Act to enact the Impact Assessment Act and the
Canadian Energy Regulator Act• Impact Assessment Agency• Canadian Energy Regulator
• Bill C-48 Oil Tanker Moratorium Act• Prohibits oil tankers along BC’s north coast (northern tip of Vancouver
Island to the Alaska border)
Both bills passed in June 2019 – but are objected by the industry and the Alberta government.
14
Emissions Crisis: Canadian GHG 1990-2017, million tonnes CO2-eq.
15
716
511
0
100
200
300
400
500
600
700
800
0
100
200
300
400
500
600
700
800
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
14.8%5.8%
24.3%
Oil & Gas Extraction
28.1%Transport
EC (2019)
Paris Agreement
Target
LNG Canada3.5 Bcf/dShell-Petronas-PetroChina-Mitsubishi -KOGAS
Other Crisis: Rail Blockades Feb.-March 2020LNG Canada & Coastal GasLink
16CBC (2020)
BC Alberta
Other Crisis: Hydropower
Site C – British Columbia
1,100 MW5.1 TWh/yrCompleted in 2025>$9 billion
BC Hydro (2020)
Muskrat Falls – Newfoundland and Labrador
824 MW4.9 TWhCompleted in 2020>$11 billion
Nalcor Energy (2020)
17
Other Crisis: Transmission Lines
18
Massachusetts Clean Energy RFP
20-yr contract 9.45 TWh/yrAwared to Hydro-Quebec in 2018 (pending transmission)
Covid-19 impact
• Catastrophic economic situation in Alberta (+ Saskatchewan and Newfoudland & Labrador)
• Economic slowdown => lowers investment prospects in the energy sector (Oil and Gas + LNG, but also in hydro and otherrenewables)
• Forced GHG reduction
How to help the energy sectors?
19
3. Sustainable Paths
20
No Easy Solution
• Consolidation in the oil & gas industry, to prepare for a possible steady or declining production
• Seek a fundamental change in consumption levels• Develop a sustainable fiscal framework
• End preferential fiscal treatments for fossil fuels• Higher carbon prices
• For decarbonization, Canada has to reconsider its provincial approach to electricity and better integrate planning and operations
21
Thank You
iaee.orgenergie.hec.ca
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