Thank you so much.
Good afternoon.
First, I'd like to thank you for inviting the Montreal Economic Institute to discuss a fundamental challenge for Canada's economic future, energy security. For those who aren't familiar with the institute, we are an independent think tank with offices in Montreal, Ottawa and Calgary. Through our research and media activities, we have been contributing to public policy debate in Quebec and Canada since 1998.
In the past few years, we have clearly seen the impact geopolitical upheavals have on the price of energy in the country. The invasion of Ukraine in 2022 and, more recently, the war in Iran are striking examples of that.
Whenever an event somewhere in the world threatens the energy supply, Canadians feel the effects at the pump. Farmers and business owners feel the effects in their energy bills, so products end up costing consumers more.
Canadians are not alone in seeing the price of energy jump. As markets are globalized and competition is fierce, prices follow the same trajectory all around globe. This is true despite Canada being a major producer of energy.
In this context, the best way to secure a reliable and affordable energy supply for Canadians is to allow our energy producers to help stabilize global supply. This means allowing the construction of the infrastructure that would allow them to ship the resources they produce to markets that need them. Unfortunately, over the course of the last decade, a series of policy choices have impeded our ability to secure the supply.
Our arbitrary and highly politicized project assessment process won out over any such efforts. Instead of establishing clear criteria based on mitigating risks and maximizing benefits for the country, the current process ultimately depends on whether the minister of the day wants a major project to get built or not. That's just as true for mines and pipelines as it is for routes and wind farms. The result is more uncertainty, which means less investment and fewer project proposals at the end of the day.
For example, the unfavourable decisions regarding the GNL Québec project helped to keep Canada's gas resources landlocked. For a few years, the government even claimed that there was no demand for the resources, despite our allies in Europe and Asia repeatedly asking for them. Although Canada did not answer the call then, it appears to have the opportunity now. This is Canada's opportunity.
In fact, the few projects that have been built, LNG Canada, in Kitimat, and the Trans Mountain pipeline expansion, in Burnaby, have shown the benefits these projects can have. Thanks to the deployment of that infrastructure, Canadian resources have found new markets. Our non-U.S. oil exports have risen from 3% to 14%, and 7% of our natural gas exports are not heading south of the border.
This does two things: one, provide the rest of the world with more reliable energy, which stabilizes prices here and elsewhere; and two, allow Canadian producers to get what their product is worth, which strengthens the economy. That is why a project to build a gas pipeline and liquefaction plant on the east coast, like the one Marinvest Energy wants to build in Baie-Comeau, should be prioritized.
By making it easier to transport natural gas from TC Energy's main system to the Côte‑Nord in Quebec, we can position ourselves in European markets hungry for new sources of natural gas. That demand was on display just yesterday. To secure Canada's reliable natural gas, Germany is willing to have it brought all the way from British Columbia to gas terminals on the North Sea, via the Panama Canal. It will take more than 26 days to ship the gas by boat. If that boat were leaving from Baie‑Comeau, instead of Prince Rupert, it would take just under eight days to reach the destination.
As you can imagine, a journey that long will affect transportation costs. The Germans are willing to pay those costs today because Canada provides something valuable, a stable and reliable supply of energy. Clearly, if eastern Canada had such a terminal, we could meet more of the European demand for natural gas, which would help our allies and stabilize energy prices.
There is no doubt that Canada has everything it needs to become a reliable supplier of oil and gas. We have abundant resources in an enviable geographic location, and as I said, importing countries are currently looking for new reliable suppliers. The only thing we are missing is an assessment process based on clear criteria, not the arbitrary decisions of the minister of the day. This is our best chance to build the projects Canada needs to help stabilize the world's energy supply and, by extension, ensure that Canadians have access to reliable and affordable energy.
Thank you.