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Resource-development sectors get little love from Liberals, NDP

Federal party platforms target fossil fuel and open-net fish farm sectors
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While most of the coal exported from Western Canada is metallurgical coal for making steel, some is thermal coal, the export of which the Liberals plan to ban | Satephoto/iStock/Getty Images Plus

Canada’s resource industries – forestry, mining, power generation and oil and gas – accounted for 17% of Canada’s gross domestic product (GDP), 1.9 million jobs, $21 billion in government revenue, $264 billion in exports and $86 billion in capital spending in 2019, according to Natural Resources Canada.

But the platforms of the Liberal Party of Canada and the New Democratic Party (NDP) have little to say about Canada’s resource industries. When they do have something to say, it’s mostly negative, with more disincentives than incentives, especially for fossil fuels, which account for Canada’s single most valuable export: crude oil.

Whereas resource sector planks run over four pages in the Conservative Party of Canada platform – with a full page dedicated to energy alone – the only planks in the NDP platform that deal with resource industries appear to be ones with negative consequences.

On fisheries and aquaculture, the NDP pledges to “support the transition to land-based closed-containment systems.” This differs little from the Liberal plan, which is to shut down open-net salmon farms in B.C. and instead encourage investment in land-based aquaculture systems.

On fisheries, the Liberal platform points to a major initiative announced earlier this year to address declining Pacific salmon stocks: the $647 million Pacific Salmon Strategy, which includes building two new hatcheries, increased conservation measures, habitat enhancement and changes to fisheries harvesting management.

The NDP pledges to end fossil fuel subsidies and help workers in that sector transition to other jobs. The NDP has not spelled out which federal tax incentives or grants it would cancel. The Liberal platform likewise pledges to “eliminate” fossil fuel subsidies.

Stewart Muir, executive director for Resource Works, said he’s happy to see a commitment in the Liberal plan to encourage carbon capture and storage in the oil and gas sector and increased investment in the Forest Industry Transformation program, which promotes wood products as a low-carbon building material. But he thinks a Liberal promise to end flow-through shares for oil, gas and coal exploration is “needless” and “a big mistake.”

“Exploration is a major driver of the B.C. economy, and there’s no question we need to find resources for the future, because energy transition is a very long-term proposition.”

Muir added that Liberal and NDP pledges to end fossil fuel subsidies fail to acknowledge the benefits that Canada reaps from a competitive oil and gas sector.

The Liberal platform pledges to phase out public financing for the oil and gas sector, including from Crown corporations. Presumably this would mean a Liberal government would never again be able to buy a pipeline, as the Trudeau government did with Trans Mountain through Canada Development Investment Corp. (CDEV) – the Crown corporation responsible for the ownership of both the Trans Mountain pipeline and Canada’s share of the Hibernia oil project.

The NDP platform criticizes the government of Prime Minister Justin Trudeau for buying the Trans Mountain pipeline to expand it, but NDP Leader Jagmeet Singh has been unclear lately on whether an NDP government or NDP-backed coalition would still cancel the $12.6 billion expansion project.

In the 2019 election, Singh vowed he would cancel it. More recently, with the project about 30% complete, Singh has refused to be pinned down on the question.

The Trudeau government’s plan is to eventually sell it to private investors. Singh has not said whether he would also try to sell it, or keep it as a Crown-owned asset. Asked what he would do about the project, Singh told Global News on August 26 he hasn’t made up his mind.

On Canada’s nascent liquefied natural gas (LNG) industry, only the Conservatives have a specific plank. It calls for a national LNG export strategy. The Liberal and NDP planks are silent on LNG. On forestry and mining, the NDP platform is also generally silent.

On mining, the Liberal platform pledges a ban on thermal coal exports from or through Canada by 2030. About half the coal mined in Canada – mostly in Alberta and Saskatchewan – is thermal coal. Most is used in those two provinces in coal power plants, which are due to be phased out by 2030, though some thermal coal mined in Canada is exported, mostly to Asia.

Muir said the ban may not have a big effect on Canadian mining jobs, but would have an impact on Vancouver port jobs.

“I don’t see any consideration of the displacement of the jobs on the B.C. waterfront because thermal coal is, for better or worse, a large provider of employment in our local ports,” Muir said.

The Liberal plan promises a new “Mines to Mobility” strategy that would encourage the mining of metals and minerals that are critical to a green transition.

It promises to double the federal mineral exploration tax credit for minerals and metals that are on Canada’s critical minerals list.

Michael Goehring, president and CEO of the Mining Association of BC, said that while the NDP platform does not address the issue, “both the federal Liberal and Conservative platforms are rightfully focused on Canada’s role as a leader in critical minerals development.

“Critical minerals are essential to develop batteries, electric vehicles and other clean technologies necessary for us to decarbonize and meet our climate targets,” Goehring said “As world leaders in responsible mining, Canada has an outsized opportunity to be a supplier of choice in critical minerals markets and help the world transition to a lower-carbon future, while growing our economy and creating new job opportunities for Canadians.”

Two of the most valuable metals or minerals mined in B.C. – gold and metallurgical coal – are not on the Canadian Minerals and Metals Plan list. So, presumably, the two mining commodities in B.C. that generate the most economic activity would not be eligible for a doubled exploration tax credit.

The Liberal plan promises that the federal government will work with the B.C. government to protect more old-growth forests in this province.

It includes a $50 million B.C. Old Growth Nature Fund that would protect “important old growth forests.” That would almost certainly mean less access to old-growth timber for forestry, which could result in more sawmill closures in B.C., especially for the coastal forestry sector.

As for the Green Party platform, released last week, its plan for Canada’s resource industries is basically to shut much of it down. It pledges to:

•end all extraction of fossil fuels;

•cancel all pipeline projects, including Trans Mountain;

•ban all hydraulic fracturing (which supplies most of the natural gas used by six million Canadians for home heating);

•cancel all new oil exploration projects;

•phase out open net-pen fish farms in B.C. by 2025 and the rest of Canada by 2030; and

•entrench owner-operator and fleet separation policies in the Fisheries Act.

The latter policy would tie licences to boats, eliminating the ownership of fishing quotas and licences by seafood processors or other corporate entities. •