By August 10, 2017 Read More →

Opinion: Here’s why Canada depends so much on its energy exports

energy exports

Between 2004-2016, Canadian energy exports of oil and gas alone amounted to $1 trillion. Syncrude photo.

Energy exports have been as much as 25 per cent of Canada’s total exports

By Stewart Muir

Canadian resource industries continue to have a highly positive impact on the well-being of the country. Yet there is no shortage of armchair critics bamboozling the public claiming oil, gas and coal don’t provide value to Canadians.

Even worse, there are even elected officials who blatantly state the falsehood that these industries don’t exist.

One ivory-tower warrior has claimed in the The Province that the oil, gas and coal sectors in Canada are “sunset” industries. (

SKYACTIV-XNothing could be further from the truth. In fact, the Canadian hydrocarbon sector is a trillion-dollar industry, and an essential requirement for the nation’s ongoing well-being.

The data plainly shows that we have a large and growing reliance on our energy industries. Between 2006 and 2016, the value of hydrocarbon exports topped $1 trillion. Of our 25 top export categories, they have accounted for as much as 49 per cent of the total value. In 2016, about one-third of the top-earning export categories were hydrocarbon products.

As a share of overall goods exports, these energy categories have been up to 25 per cent of Canada’s total exports — a staggeringly large dependency if you think about it.

Another way to come at the data is to say that from 2004-2016 oil and gas alone (not including coal) accounted for over $1 trillion worth of exports.

Although some economists rightly lament that Canada is too reliant on its resource exports and a handful of manufacturing industries, common sense tells us that the solution to this problem isn’t to shut them down, as so many activists want us to do. We need the revenues too much, and if we don’t have them it’s not possible to pay for the things we need.

And what things do we need? Here are a couple of examples:

Since 2006, our annual need for imported medicine and blood/immunity products has grown to over $11 billion a year. In the same period, the consumption of mobile phones and personal computers has grown more than fourfold, also to about $11 billion annually.

That’s $22 billion a year in total. Where can we find the spare money for this? From exports, of course. The only alternative is to put it on the national credit card (so to speak). Mercifully few of us are silly enough to think that’s a good idea.

With the dominant role played by energy exports, there is a clear connection between them and these essential imported goods that can make the difference between life and death for millions of Canadians.

What if we decided to heed those who say it’s time to stop exporting oil, gas and coal? Could we shrink our export economy by one quarter or more? The fossil-fuel opponents say its simple: All you need to do is “build sustainable businesses” and pursue “new forms of community investment” and “innovations in food systems” that are “more inclusive.”

Simple, right? Actually, such clichés are of no help to someone ailing in a hospital bed.

Canada does need to continue improving its environmental performance through innovation. It can’t afford to stop exporting resource commodities, nor is it desirable to do so, as that will only increase the market share for similar products from jurisdictions that are socially and environmentally unsustainable.

The path forward is to continue developing our resources responsibly so that our sick have medicines and our businesses are able to acquire the high-tech tools required to stay competitive. If we do this, and only if we do this, Canada will continue to be a beacon of health, freedom and prosperity for the world.

Stewart Muir is executive director of Resource Works and and writes for Canadians for Affordable Energy.

This column by Stewart Muir originally ran in The Province on August 7, 2017.

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Posted in: Canada

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