On November 9th, 2024, the Canadian Government published a proposed policy to cap oil and gas sector emissions, known as Canada Gazette Part 1. While the final targets will not be set until 2026, the Government estimates that this policy, in conjunction with other policies, will reduce GHG emissions from the oil and gas sector by 35% in the early 2030s compared to 2019. When flexible compliance options are considered, actual emissions are targeted to decline by 19% from 2019 levels.

This week, Sander Duncanson, Partner at Osler and Co-Chair of Osler's national Regulatory, Indigenous, and Environmental practice, joins the podcast. Osler is a leader in Canadian business law.

Peter, Jackie and Sander discuss their concerns with the proposed policy. Topics covered include:

• The low likelihood of the regulation becoming final law.
• The potential for the policy to create winners and losers, market distortions, and other unintended consequences.
• The complexity of Canada’s regulatory framework which reduces investment.
• Concerns that Canada and the United States are moving in opposite directions regarding carbon policy. Canada is increasing stringency, while the US is expected to reduce its carbon policy, thereby creating the threat of investment moving from Canada to the US (carbon leakage).
• The options to provide feedback on the proposed policy are available until January 8th, 2025.

Content referenced in this podcast:

• Canada Gazette, Part I, Volume 158, Number 45: Oil and Gas Sector Greenhouse Gas Emissions Cap Regulations (November 9th, 2024)
  • Consultation feedback can be provided within a series of online forms in the Gazette, Part 1 link above, by January 8th, 2025. Another option for feedback is to submit a “Notice of Objection” by the same date. More information on this option can be found under the heading “PROPOSED REGULATORY TEXT” in the Gazette.
• Peter Tertzakian’s commentary in The Hub “DeepDive: It’s time for a carbon policy time-out” (November 2nd, 2024)
• Osler’s Blog “Federal government announces constitutionally questionable oil and gas sector emissions cap” (November 8th, 2024)

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