January 11, 2017


I’ve been in the conservation and climate change business for over 20 years and have been a strong advocate for action and leadership. However, when it comes to the oil & gas industry, I know things get complicated given the following two things are true:

  1. We need to transition to a low-carbon economy to stave off the worst effects of climate change and to protect our planet (and our economy) for future generations.
  2. Energy demand is increasing and will continue to ramp up until the end of the century. The world’s population is heading toward 10 billion people and emerging economies like China and India have significant energy demands. Alternatives to fossil fuels, such as renewables, can’t meet the entirety of that growing demand (yet).

These two trends shine a spotlight on Canada’s oil & gas industry and the role they play in our national dilemma and opportunity around climate action. Canada is keen to regain credibility in the international arena, with ambitious plans that include a price on carbon, an accelerated coal phase-out, a commitment to green public service operations, and a clean fuel standard.

However, we are all keenly aware that the development, production, refining and in particular burning of fossil fuels are responsible for a significant percentage of global greenhouse gas emissions, which are causing climate change.

Complicating the matter even further is Canada’s economic reliance on our energy sector. In fact, when the tragic wildfires hit Fort McMurray in May 2016, our economy contracted by 0.6%. A slowdown in manufacturing was another reason for the decline, but nevertheless this was the worst monthly GDP figure since March 2009.

So the question is, how does Canada square this circle?

The Canadian Quandary: Is the Oil & Gas Sector a Zero-Sum Game?

Talking about the future of the energy industry in Canada can often result in a polarized debate. Some call for the oil sands to be shut down altogether. Others support maintaining the status quo. A third more pragmatic view is that the transition away from fossil fuels as they are developed and used today is inevitable, but is going to take time. The question is: How much time? As long as we have a supply issue, the proponents of the third viewpoint suggest that Canada’s products are the cleaner (and socially responsible) alternative to shale oil or to products coming out of other countries, such as Venezuela and Russia.

Not surprisingly, this conversation is top of mind for industry. From all the discussions I’m having with people around the country, it’s clear they’re ready to talk seriously about the issues. What do they want to talk about?

  • To what extent is Canada going to work with the energy sector (and, to be frank, all sectors) to transition to a lower-carbon model?
  • How will investment be mobilized to incentivize innovation and support the development of advanced technologies that can help reduce GHGs in the industry?
  • What are we doing to make our product the most carbon- and cost-competitive in the next 10 to 15 years?
  • What kind of mechanisms, programs and systems are needed to accelerate the low-carbon transition?
  • How can we increase the speed at which we integrate productivity-boosting technologies and best practices within Canadian oil and gas companies’ operations and organizations?
  • Can Canada capitalize internationally on being an expert in decarbonizing the upstream oil and gas sector?
  • Can Canada be a leader in developing technologies that eliminate carbon emissions from the combustion of fossil fuels? If so, what role can our energy sector play?

We Can All Agree on One Thing: Climate Action is a Must

The climate change debate is over: we need to accelerate the transition to a low-carbon future across the entire economy.  Our oil & gas sector not only has to be part of this conversation, but it is a critical part of the way forward for Canada. The good news is three-fold: our most fearless energy companies are already on board; the Alberta government has a progressive position on climate change and a history of regulation; and, as global energy systems undergo a profound transformation, Canada is in an excellent position to share our innovative ideas and solutions with the world.

How can we accelerate the path to local and international commercialization for Canadian oil and gas innovation?

These questions and more will be explored at the “Industry Roadmap: The Future of Oil & Gas 2017” event in Calgary on January 17th. Delphi is a supporting partner of the event, which is being hosted by TheFutureEconomy.ca and Milestone GRP and showcases many of the issues and opportunities that are top-of-mind for Delphi and our clients.

Partners and friends of The Delphi Group are eligible for a $50 discount off the regular ticket price (use discount code “Delphi”). Delphi Director, Dr. Carol-Ann Brown, will be attending the event and moderating the wrap-up session so make sure to say hello. Post-event, Delphi will produce a thorough recommendation report highlighting the event’s key insights, opinions, conclusions and recommended action points for industry and the federal and provincial governments. Register here.

We will also be exploring these themes in an ongoing blog series on the Canadian energy sector.  In the series, we’ll explore the issues and opportunities from a number of perspectives, incorporating diverse views from some of Canada’s leading experts.

Mike Gerbis, CEO (mgerbis@delphi.ca)