“We use more wood, coal, oil, and gas today to generate energy than at any point in history. We have come to accept…there are no solutions, only tradeoffs.” — Cenovus CEO

Oil industry executive warns Canadian government, stop believing in magic.

By Jennifer Cowan (and Reuters), published by The Epoch Times

In Brief by Probe International

The CEO of Cenovus Energy has warned that Canada’s current regulatory and carbon-pricing regime has made a proposed one-million-barrel-per-day oil pipeline from Alberta’s oil sands to the British Columbia coast impossible to finance with private capital.

Speaking at the Global Energy Show in Calgary this week, Jon McKenzie said industrial carbon pricing, combined with stringent regulatory requirements, is eroding Canada’s competitiveness for energy investment and forcing producers to focus on sustaining existing operations rather than pursuing major new projects.

The proposed West Coast oil pipeline stems from a May agreement between Prime Minister Mark Carney and Alberta Premier Danielle Smith. The deal could clear the way for construction as early as 2027 if the federal government designates it a project of national interest.

McKenzie stressed the pipeline cannot move forward without the proposed Pathways CCS (carbon capture and storage) network, which aims to capture emissions from oil sands facilities and store them underground. He estimated the combined cost of the pipeline and Pathways could reach $30 billion — costs that would largely fall on the oil industry while producers simultaneously face rising industrial carbon taxes.

McKenzie criticized Canada’s escalating industrial carbon tax schedule, arguing it could force economically viable oil projects to shut down prematurely and reduce the sector’s competitiveness. He also questioned the business case for carbon capture, saying none of Cenovus’s customers have asked about the carbon intensity of Canadian crude oil and that market demand for lower-carbon barrels is not evident.

Rejecting the idea of a straightforward transition away from fossil fuels, McKenzie argued the world is entering a period of energy diversification rather than replacing oil and gas with renewables.

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