Natural Resources

The House of Commons Standing Committee on Natural Resources met on February 3, 2026, to study the management of Canadian energy exports. Appearing as witnesses were Normand Mousseau, a professor at the Université de Montréal; Pierre-Olivier Pineau, a professor at HEC Montréal; Dan McTeague, president of Canadians for Affordable Energy; and Heather Exner-Pirot, director of energy, natural resources and environment at the Macdonald-Laurier Institute.

Normand Mousseau argued that Canada is not an energy superpower despite being a major exporter, because its production is fragmented, its markets are dominated by a single customer (the U.S.), and it lacks influence on global prices. He said new electricity supplies have no competitive advantage over the U.S., LNG Canada will keep Canada a second-tier player in natural gas, and Trans Mountain pipeline is barely recovering operating costs with no hope of amortizing construction costs. He recommended that Canada develop a real strategy to adopt and master modern renewable energy and electrotechnology, focusing on niche markets such as long-duration batteries and off-road electrification, rather than simply handing out subsidies.

Pierre-Olivier Pineau said Canadian energy exports have grown significantly since 2000 but are vulnerable to price drops, with Alberta's economy hurt three times in 20 years by oil price declines. He identified barriers to exports as low world prices, high Canadian production costs, and limited growth in oil demand as China and Europe reduce diesel and gasoline consumption. He recommended moving away from oil export orientation toward improving energy productivity and developing sustainable markets in non-hydrocarbon products, and stressed that electrification is a global trend driven by efficiency, not ideology. He disagreed with Mousseau on whether Canada has a competitive advantage in electricity, arguing that Canada's geography gives it ample wind, sun and space for low-cost production.

Dan McTeague said Canadian energy exports reached $208.2 billion in 2024, with 94% of oil and gas going to the U.S., and that the main limiting factor is infrastructure, with Bills C-48 and C-69 still in force. He argued that global demand for hydrocarbons is increasing, not decreasing, and that if Canada does not supply them, poorly regulated authoritarian countries will, increasing global emissions. He said the government's mixed signals, including requiring decarbonization before building infrastructure, have made Canada too risky for private investment, and that the government should defend and expand energy exports to pay down debt, strengthen the dollar and lower the cost of living for Canadians.

Heather Exner-Pirot said Canadian oil and gas exports have diversified since Trans Mountain and LNG Canada started, with crude exports to the U.S. dropping from 97% to 84% and new markets including China, India and Spain. She said Trans Mountain is running at 92% capacity and that Enbridge and Trans Mountain are both planning expansions, but that two new pipelines are needed in the medium term, starting with the Prince Rupert Gas Transmission followed by a west coast oil pipeline. She recommended that Alberta and Canada de-risk a new oil pipeline through indigenous loan guarantees and clear legal and regulatory hurdles, and that the government address mixed signals from methane regulations, carbon pricing and indigenous consent policies to restore investor confidence.

During questions, Mousseau and Pineau agreed that biomass is underused in Canada and that a national strategy is needed to structure the market, with Pineau adding that a carbon tax is important to make biofuels competitive. Exner-Pirot and McTeague argued that the cancellation of the Northern Gateway pipeline and the ballooning costs of Trans Mountain have made Canada a risky jurisdiction for private oil pipeline investment, and that political alignment and regulatory certainty are needed to attract capital. Exner-Pirot said the MOU between the federal government and Alberta was a good step but that policies from Environment and Climate Change Canada, including the output-based pricing system discussion paper and methane regulations, are creating new uncertainty. The committee did not debate or vote on any motions during this meeting.