The Oil Sands: Canada's Salvation?

In a recent MacLean's article retired oil executive Ross Belot argues that Pierre Poilievre's commitment to bring back Alberta's oil sands is naive if not disingenuous. Poilievre claims that reduced taxation and loosening regulations is all that is holding the oil sands back from the glory days. But this is putting the cart before the horse: the oil sands were only viable when oil prices were booming...rather than the development of the oil sands causing an oil boom. The oil sands need high oil prices to be developed, and to operate economically, especially in today's market where the US dominates with fracking in the Bakken formation and the Permian basin. Belot argues that companies are far more likely to invest in fracking because it offers a much better return on the dollar and offers access to oil more economically than the oil sands. Without high oil prices deregulation, coupled with more tax breaks, won't make the oil sands competitive enough for companies to invest.

While pithy quotes such as "Axe the tax" and "Repeal Bill C-69" (which put stricter rules on pipelines and other oil sands projects with regard to the environment) make for great politics, the underlying arguments for axing and repealing seem to lack substance. One can only hope that Poilievre's other promises are more than just sound bites for his audience....the next four years will demand more than just vacuous optics.