Update on Positioning Canada to Lead the Global Gas Conversation

May 27, 2022

The Right Honourable Justin Trudeau
Prime Minister of Canada
80 Wellington Street
Ottawa, Ontario K1A 0A3

Subject: Update on Positioning Canada to lead the Global Gas Conversation

Dear Prime Minister,

Further to my correspondence of March 25th and April 29th, I wanted to give you an update on our work to position Canada as a reliable natural gas trading partner for our allies in the wake of Russia’s invasion of Ukraine.

I continue to meet with European Ambassadors to Canada to discuss their energy needs, and to assess Canada’s potential role in addressing these going forward. The consensus comment so far from our allies is they want Canada to do more to get our natural gas into the global marketplace as quickly as possible.

I have also taken the opportunity to engage in discussions with various industry leaders from companies across Asia – including those from Japan, Malaysia, and Korea – while at the World Gas Conference this week in Korea. They too are very explicit about their desire for Canadian natural gas to help address pressing concerns like poverty reduction, air quality improvement, and energy security.

As I noted in earlier correspondence, Canadian industry stakeholders across the natural gas value chain –including producers, delivery companies, suppliers, First Nations, and industrial customers – are engaging with us about how to develop the gas opportunity for Canada and for the world. These stakeholders are delighted to see evidence from recent media reports that you and your cabinet colleagues are pursuing conversations with project proponents and operators on various LNG project opportunities. The potential for LNG export is being considered on virtually every coast, and many provinces and territories stand to gain if the conditions are in place for projects to proceed. All in the industry look forward to the opportunity to engage with the Government of Canada to realize the potential.

As also noted in my earlier letters, Canada’s gas resources are amongst the cleanest in the world, certainly much cleaner than many current and possible options for global markets. And given the strong focus and capital investments on emission reductions by our industry, Canadian natural gas is getting cleaner all the time. This means that more Canadian gas in the global market would do a great deal to significantly reduce global GHG emissions. Too often we focus on what the impact of these projects will be on a Canadian emission cap. This seems a narrow view: if the ultimate objective is reducing global emissions and Canada can do more on that front by producing and exporting more, we should focus on the global impact. Holding back Canadian gas development to meet emission caps may keep domestic emissions down but drive global emissions up: surely this isn’t the desired outcome.

The emissions reduction benefit of more Canadian natural gas development is very real, but the economic and security benefits of a serious LNG development strategy would be even more tangible in the near and medium term.

On the economic front, consumers are deeply concerned about inflation and rising interest rates, compounded by rising energy costs and additional new taxes and regulations. Energy affordability is key to offsetting rising inflation, and more Canadian natural gas development will help keep energy affordable, for our own citizens and others. And we shouldn’t conclude a discussion of economics without noting that Canadian LNG projects generate tens of thousands of permanent well-paying jobs across the country.

On the security front, a focused effort to develop LNG resources off our various coasts is fundamental to being able to make a real impact on global energy security. More Canadian gas means less dependence on (and less profit for) the less reliable, less clean, less politically stable supply options – and that helps the world’s security.

In sum, a vision for gas development in Canada that is aimed at moving more gas into the market more quickly will deliver environmental, economic, and security benefits in short order.
I will continue to report out on our progress as we continue to define the elements of our gas vision and would welcome any questions you might have about our efforts, and engagement with you on them.

Respectfully,

Timothy M. Egan
President & CEO, Canadian Gas Association
Chair, NGIF Capital Corporation

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