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September 16, 2019

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Canada-U.S. energy alliance aids both sides

When you turn on your stove or fill up your car, do you ever take a minute to wonder about where the energy comes from? Not that likely, although in this world of ever-increasing expectations around energy affordability, environmental impacts and security, it might just be a good idea. Did you know that your neighbor to the north, Canada, is now the largest energy supplier to the United States? Expanding this relationship makes sense.

The dynamism of the Canada-U.S. energy relationship is often forgotten as we charge our BlackBerrys or fuel our vehicles; yet behind our wall plugs and beneath our gas pumps is the footprint of Canada’s energy relationship with the United States.

Canada has an enviable supply of hydropower, natural gas, oil, uranium and wind power, and our energy exports are largely flowing south. We’re the third-largest producer of hydroelectricity in the world, and almost all the electricity that the United States imports comes from Canada. Canada holds the third-largest reserves of oil after Saudi Arabia and Venezuela at 174 billion barrels. Some 80 percent of the world’s known oil reserves are state-controlled or managed by national oil companies. However, Canada’s government does not run our oil sector. We are not members of OPEC. And of the 20 percent of the world’s oil supply that is openly accessible to market-based development, 60 percent comes from Canada’s oil sands.

The Canada-Nevada trading relationship is valued at $1.6 billion. More than 68 Canadian-owned companies employ more than 5,100 Nevadans. Canadian energy company Tuscarora Gas Transmission Co., which is owned by TransCanada, operates a 229-mile interstate natural gas pipeline system that delivers energy to the utilities, businesses and citizens of Nevada.

Canada provides an affordable, reliable and sustainable source of energy for the United States. That is good for both countries. In fact, 8 million American jobs depend on trade with Canada. Our relationship is a good-news story, given the geopolitical situation of many other major oil-exporting countries, and the shared values Canadians and Nevadans hold regarding energy extraction and use.

Groups are actively campaigning against the construction of Keystone XL, a pipeline that would carry Canadian oil to the United States. There is no question that Keystone XL is an enormous engineering project, but it has been subjected to a comprehensive environmental review and will be going far beyond existing U.S. pipeline safety regulations.

As for projects in Canada’s oil sands, these are also subject to extensive environmental and regulatory review. The oil sands are a key strategic resource, an economic engine contributing substantially to employment and a strong economy on both sides of our border. More than 900 American companies, large and small, provide goods and services to the oil sands operations. In short, expanding the capacity and increasing deliveries from Canada’s oil sands mean good things for U.S. jobs. Canada and the United States have a long history of integration within energy markets and infrastructure, and we share an extensive secure cross-border network of pipes and transmission lines.

Given the integration and mutual benefits to both Nevada and Canada, the question really is, how do we strengthen and further diversify this energy relationship? Canada recognizes the environmental challenge before us and is acting to regulate and invest in science and technology improvements for energy production.

Unlike many energy exporters, we are committed to transparency in the way we assess energy projects. Canada is proud of its diversified energy relations with Nevada and the United States, and we look forward to debate and dialogue on the future of our energy partnership.

David Fransen, consul general of Canada in Los Angeles, with responsibility for Nevada.

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