Ottawa’s consultation on oil and gas emissions cap under fire from Indigenous group

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The industry group representing First Nations that produce oil and gas says Ottawa failed to consult it on plans for a fossil fuels sector emissions cap, and says such a mechanism would likely strip away one of the few revenue sources that helps its members gain economic sovereignty.

The federal government on Friday closed public submissions about how to best design and implement the cap, which it says will help reduce pollution from the oil and gas sector – the largest source of greenhouse gas emissions in Canada. Ottawa argues the cap is crucial to ensure emissions drop at the pace and scale necessary to achieve Canada’s 2030 and 2050 climate targets, and allow the sector to compete in a global economy that is transitioning to net zero.

Federal officials asked for input on various aspects of the cap, including what activities it should cover, how best to encourage continued investment to abate emissions, compliance options and when a cap should be implemented. Ottawa also asked whether it should be a new cap-and-trade system under the Canadian Environmental Protection Act, or a modification of the current carbon pricing approach.

Stephen Buffalo, president and chief executive of the Alberta-based Indian Resource Council, said while the government may have spoken with various Indigenous groups, it failed to reach out to those that actually produce oil and gas.

“No consultation with the First Nations who need this for an economic driver for the communities? It’s not good,” Mr. Buffalo told The Globe and Mail.

“When you’re only consulting with the people that agree with you, it’s not the best scenario.”

Mr. Buffalo is a member of the Samson Cree Nation, about 100 kilometres south of Edmonton, and he said the IRC made a submission to the federal government, but the group feels it was left out of key discussions about a huge change that could undermine economic development in many communities.

“I’m a proponent and advocate for our First Nations really getting out of poverty, and the resource sector is probably the best way,” he said.

“As we’re progressing forward and we’re seeing industry opening up the door for investment, for opportunity, for jobs, for equity ownership, and now we get this cap put on us. It’s really difficult.”

Federal Environment and Climate Change Minister Steven Guilbeault told The Globe on Friday that consultations were open to everyone.

He said everyone must reduce their dependence on fossil fuels, and his government has various programs designed to work with Indigenous communities during the transition to a greener energy economy.

He also stressed the cap is on emissions from the oil and gas sector, not production.

“In many ways, we’re very agnostic about the production as long as the emissions are going down,” Mr. Guilbeault said.

While reducing emissions will be a challenge in the oil patch, it’s tough for any industry, he said.

“We’re demanding of the oil and gas sector, but we’re demanding of every sector of Canadian society,” he said. “I haven’t had one meeting since I was Environment Minister where people have told me this is piece of cake.”

Other parties that submitted input about the emissions cap include environmental groups; individual fossil fuel companies; and industry groups such as the Pathways Alliance, which represents companies that produce about 95 per cent of crude in the oil sands.

Martha Hall Findlay, chief climate officer with Suncor Energy Inc., which is a member of Pathways, said the alliance is not opposed to the cap because it’s already working to get to net zero by 2050.

And while the emissions cap timelines put forward by the federal government were a “significant surprise,” Ms. Hall Findlay said Ottawa seems to have a sincere desire to work pro-actively with the oil sands sector.

“We need to continue to work collaboratively to find the solution to get the biggest reductions in emissions that we can, economically, in a short timeframe,” she said, adding that engineering and field studies for a significant oil sands carbon capture pipeline are already under way, along with nine other carbon capture feasibility studies.

The Pembina Institute, a think tank, said in its submission that the federal government should finalize clear targets for 2026 and 2030 – preferably before the COP27 UN climate change summit in Egypt in November – before it spends more time on the detailed regulatory design of the emissions cap.

Deputy executive director Simon Dyer said providing certainty on the trajectory of the cap is critical to spur urgent investments in decarbonization.

“It seems pretty clear that all stakeholders are less interested in the detailed mechanics [of the cap] and more interested in the federal government needing to clearly indicate what the target will be,” Mr. Dyer said in an interview. “That will inform much more planning and investment versus spending the time developing a detailed regulatory approach.”