Jonathan Wilkinson, federal Minister of Energy and Natural Resources, speaks with Alberta Primetime host Michael Higgins about the Alberta government’s Scrap The Cap campaign.

This interview has been edited for clarity and length.

Michael Higgins: The Scrap the Cap campaign directly targets your government’s policies. What is your response to the Smith government’s assertions?

Jonathan Wilkinson: I think that’s a bit of an exaggeration for a regulation that hasn’t even been published yet. I would say though that this perhaps reflects the fact that Premier Smith has a leadership review coming up and that fighting with the federal government is always good policy.

This is an emissions cap, not a production cap. It’s no different than tools that have been used in other sectors to try to actually reduce emissions, and it’s important to reduce emissions. Climate change is real, and emissions from the oil and gas sector currently account for about 30 percent of Canada’s emissions. This is the only sector that continues to grow and it needs to start going down.

The bulk of the emissions the cap seeks to target fall into two areas, one being reducing methane emissions. This is something that Premier Smith, when developing a climate plan with Sonia Savage before the last election, said she agreed with. And the other part is that the oil sands and the numbers that we use, in terms of actually achievable emissions reductions, are the numbers that the industries themselves publish.

So I think people will understand that this is a pretty reasonable approach to reducing emissions, and it’s not a cap on production. I would simply encourage Premier Smith to wait for the regulations.

MH: How do you counter Alberta’s claim that your policies are having a financial impact on ordinary Canadians and making everything more expensive?

JW: This is simply false and, in fact, goes directly against what Premier Smith is saying. Ultimately, reducing emissions from the oil and gas sector will actually reduce the carbon intensity of the fuels we are able to supply to the world. This will be one of the bases of competition in the future.

It’s actually about strengthening the competitiveness of Alberta’s oil and gas industry, as well as that of Newfoundland, Saskatchewan and British Columbia. This will not result in any additional costs to Canadians and, in fact, as I said, it will actually help from an economic point of view.

MH: I understand you are speaking with members of the industry today. As Minister of Energy, what are your thoughts on the direction of demand for oil and gas and how that translates into the direction of production, particularly here in Alberta?

JW: The International Energy Agency released its World Energy Outlook this week. It is the leading agency for energy forecasting and, of course, works to ensure the energy security of Western countries.

What he says is that in all scenarios, oil and gas will peak by 2030 and then begin to decline in terms of global demand. Most people would actually assume that’s the case as we deploy more electric vehicles and move towards more electrification, but what that should mean to the industry is that we’re going to have to be increasingly competitive, not only from a cost point of view, but also from a cost point of view. in terms of the carbon intensity of the products we sell. Because it will have value in a world moving toward lower carbon emissions.

Decarbonization therefore consists of strengthening competitiveness in a market that will eventually decline. This is not to say that there won’t be long-term uses for oil and gas, a third of oil is already used for non-combustion applications, does not cause climate change, and natural gas can be converted into hydrogen, at very low cost. carbon and hydrogen, which will certainly be valuable in the future.

It’s time we step back and think very clearly and thoughtfully about this issue, and I think protesting against the wind, as Prime Minister Smith seems to want to do, is not going to really get us far.

MH: Alberta’s environment minister says her government has been informed and the oil and gas production cap will come at the same time as COP 29, which we know is the United Nations Conference on climate change which will be held in Baku in November. When should Albertans expect your proposed regulations to be released? What is the timetable?

JW: It will not be published at an international conference. This is an important domestic policy, it is important to disseminate it in Canada. It will be released in the coming weeks, I think in the next few weeks, so it’s not too far away.

It will be published in draft form and we will consult and actually hear what people have to say. There may certainly be changes between the initial draft and subsequent versions of the regulation, but there will be a consultation period of several months.

I would also say to Rebecca Schultz that the language she uses is interesting, that the only place in the world that already has an emissions cap is Alberta. An Alberta government actually created an emissions cap, this one is a federal emissions cap, and it’s more ambitious because the other cap allowed for significant growth in emissions. But it was Alberta that came up with the idea of ​​a cap.