Shannon Stubbs Letter to Minister Sohi, Minister of Natural Resources

July 23, 2018

The Hon. Amarjeet Sohi
229 Wellington Street
Suite 707
Ottawa, ON K1A 0H8

Dear Minister Sohi,

Congratulations on your appointment as the new Minister for Natural Resources. As the Conservative Shadow Minister for Natural Resources, I look forward to working with you to ensure Canada’s natural resources sector is prosperous and successful. This is of vital importanceto my constituency of Lakeland, to your constituency of Edmonton Mill Woods, and for the hundreds of thousands of Canadians from coast to coast to coast whose livelihoods depend on it.

Canada’s natural resources sector is the backbone of the Canadian economy. We have among the highest environmental standards and the most socially responsible resource development in the world. Economists also recognize that without income derived from the resource boom, Canada’s standard of living and the well-being of Canada’s middle class would suffer.

Canada is home to the third largest recoverable oil reserves in the world, a sector in which every upstream job creates two indirect and three induced jobs in other sectors across the country. Canada is also the fifth largest producer of natural gas and has the 19th largest proven natural gas reserves in the world, enough to supply consumers with natural gas for the next 300 years. Global demand for oil and gas is expected to grow exponentially in the coming decades.

It is your government’s moral, economic, and environmental obligation to champion Canada’s responsible energy development, and to expand market access so Canada can be a supplier of choice to the world, now and long into the future.

However, that requires Canada to competitive and in the last two and a half years your government’s policies have hurt our ability to attract and maintain foreign investment.

In fact, foreign direct investment in Canada plummeted by 42% in 2016 and then by a further 27% in 2017. While Canadian investment in the United States has increased 66% since 2015, American investment in Canada has decreased by 52%. Furthermore, in the last two years more than $100 billion of investment in Canadian energy projects has been cancelled. These were projects in an advanced stage of planning, and represent only a fraction of investment capital leaving the Canadian energy sector. Worse still, the Bank of Canada predicts there will be no new energy investment in Canada after 2019.

This has resulted in more than 110 000 energy workers losing their jobs, thousands of individual contractors being put out of work and businesses being forced to close their doors. At the same time, your government oversaw the cancellation of three viable, private sector pipeline proposals that would have ensured Canadian energy security and expanded Canadian export access into multiple markets in order to reduce reliance on the United States—Canada’s biggest energy customer and competitor.

The key factors for the future of Canadian resource development are: competitiveness, market access, and certainty. But the cumulative impact of your government’s tax hikes and new regulations are hampering Canada, especially in comparison to other major resource producing countries around the world. Canada currently ranks 34th out of 35 OECD countries in the time required to obtain a permit for a new general construction project, and this will only get worse if Bills C-68 and C-69 are allowed to pass.

I urge you to influence your government’s policy direction effectively. I was disappointed when your predecessor admitted at a recent committee meeting that he wasn’t involved in the decision to spend $4.5 billion of taxpayers’ money to purchase the Trans Mountain pipeline, and could not provide any details about the future of the expansion project. A response to an Access to Information request several months ago also showed he had no say in the decision to cut the Canadian Exploration Expenses Tax Credit for new oil and gas well drilling and was caught off guard by it in the 2017-18 federal budget. I hope you will not be sidelined in major decisions like these that have significant impacts on your portfolio and on Canadian workers and, that are crucial to Albertans specifically.

On that note, I want to highlight my concerns with your government’s tanker ban, which is a deliberate barrier to the oil sands, to pipelines, and to Canadian export opportunities to the Asia Pacific. I hope you will assess it with a fresh perspective as it is considered by the Senate in the fall. Bill C-48 puts at immediate risk a $16 billion Indigenous-owned pipeline project from Bruderheim to Grassy Point, and is being challenged by indigenous communities that oppose the bill, who your government failed to consult.

Approximately 32 000 Métis and First Nations people work in resource development in Canada; as a sector, mining is the single largest employer of Indigenous Canadians, while a significant majority of Indigenous communities support pipelines and petroleum development. I hope you will ensure those communities that seek economic partnerships, jobs, and reconciliation through prosperity in resource development won’t lose opportunities because of distant, anti-Canadian
resource activism or the promotion of perspectives from communities that aren’t directly impacted.

Your government’s Arctic offshore drilling ban is another anti-energy policy I hope you will reconsider. The Premier of the Northwest Territories has said this is “colonial, patronizing, and destroyed hope and opportunities for healthy living in the territory.” In addition to mining, oil and gas exploration is critical for Northern economic development and for the livelihoods of Northern Canadians, who already face high costs of living.

I understand and support the need to develop Canada’s natural resources in an environmentally responsible manner. However, recent legislation proposed by your government, including Bills C-48, C-68, and C-69, will drastically impact Canada’s natural resources sector and impede Canadian oil and gas from getting to new markets. I urge you to abandon these bills and focus instead on the concerns being raised by Canadians.

I sincerely hope you will advocate for Canada’s resource sector and the men and women whose livelihoods depend on it. I look forward to you undertaking “meaningful engagement with Opposition Members of Parliament, Parliamentary Committees and the public service” as the Prime Minister’s past mandate letters instructed and to “avoid escalating conflicts unnecessarily.” I am sure we can agree that such an approach to this particular portfolio is merited given its importance to all of Canada, and particularly because of its significance to all of the Albertans we each represent.

Again, please accept my congratulations on your new appointment. I look forward to working with you. Rest assured that my Conservative colleagues and I will continue to hold your government, and you, accountable on this file.

Shannon Stubbs
Member of Parliament for Lakeland and Shadow Minister for Natural Resource