Ottawa Begins Talks on Upper Oil and Gas Emissions

The federal government Discussion paper It outlines two options for reducing emissions from the oil and gas sector to reach the 2030 target and achieving net zero by 2050, and seeks information from stakeholders.

The two options proposed by the Liberal Party government include the development of a new cap-and-trade system and the modification of the existing carbon pollution pricing system.

“True global energy security and affordability are only brought about by reduced emissions,” Environment Minister Stephen Gilbow said on July 18. statement Published a treatise.

“With this cap, we will work with industries, states, indigenous groups, civil society and more to take action to reduce emissions from oil and gas production.”

According to the discussion paper, cap-and-trade options set permissible greenhouse gas (GHG) emission quotas within a defined time period and decrease over time.

A “emission permit (” allowance “) is issued for each ton of emissions permitted under the upper limit of the period. Emissions subject to the cap must pay one allowance for every ton of emissions, expressed in tons of CO2 eq. “

The allowance may be fully or partially auctioned and the proceeds may be reinvested in the decarbonization of the sector.

The report states that the allowance per ton of emissions is less than the system’s “normal emissions”, creating a rarity that drives demand in the cap-and-trade market.

Quebec and Nova Scotia are currently implementing such systems.

The second proposed option includes modifications to promote further emission reductions from the oil and gas sector, based on the current federal approach to carbon prices.

Current federal benchmarks include the lowest domestic price per ton of CO2 eq emissions. This will increase by $ 15 a year to reach $ 170 per ton in 2030.

The paper states that if carbon prices set for the economy as a whole are at a pace to meet emission targets, it will also apply to the oil and gas sector. Otherwise, the sector will have to follow different pricing schemes to accelerate emission reductions.

According to the Canadian Ministry of the Environment, the oil and gas sector will account for approximately 27% of total GHG emissions in 2020, making it the largest source of emissions.

This sector donated $ 118 billion to Canada 1,576 GDP in 2020 is 1 trillion.

The government is seeking stakeholder feedback on the options proposed by September 30.

The new policy is expected to be revealed in early 2023.

Noe Chartier


NoƩ Charter is a Montreal-based Epoch Times reporter. Twitter: @NChartierET Gettr: @nchartieret