Carney says he'll work with oil and gas industry, says he opposes 'preset caps'

Prime Minister Mark Carney has suggested he may be willing to move away from emissions caps for the oil and gas industry in a shift from his predecessor, Justin Trudeau, whose government had begun the process to regulate greenhouse gas.

Speaking to reporters in Edmonton after meeting with Alberta Premier Danielle Smith Thursday, Carney was asked how he planned to counter the harmful effects of U.S. tariffs on the oil and gas industry, while also supporting an emissions cap. 

Carney said he wanted to make Canada's energy sector more competitive by "working with industry and with provinces on specific ways to get those reductions, as opposed to — and last point which goes to your question — as opposed to having preset caps or preset restrictions on preset timelines."

The prime minister didn't elaborate, but his comments appear to contradict the federal Environment Minister he appointed days ago, Terry Duguid. 

In a recent interview with The Canadian Press, Duguid said that, if elected, Carney would maintain the Liberals' proposed cap on emissions.

"We want that energy. What we don't want is that pollution," Duguid said. 

Trudeau promised a cap on emissions from oil and gas in the 2021 election and began the regulation process in 2022. 

In November, the Liberals introduced draft regulations — two years behind schedule — that require producers to cut emissions by about one-third over the next eight years, and said that the regulations did not place a cap on production.

The federal government also proposed a cap-and-trade system where each company would be given an emissions allowance equating to one unit per tonne of carbon pollution. Companies that pollute less would be able to sell their leftover allowance units for profit, while companies that don't reduce their emissions enough would have to buy allowance units from other companies to stay in compliance.

Alberta premier lists demands

Smith said that in her first face-to-face meeting with the new prime minister she gave him an earful on wildfires and oil sales and warned him that national unity hangs in the balance.

"I provided a specific list of demands the next prime minister, regardless of who that is, must address within the first six months of their term to avoid an unprecedented national unity crisis," the Alberta premier said in a statement Thursday after her morning meeting with Carney in the Alberta capital.

Smith has been a longtime critic of Trudeau, saying federal Liberal government policies have for years illegally encroached on Alberta's resource rights and strangled its wellspring oil and gas industry.

Smith said it was Carney's idea to meet and that they had a "frank discussion."

"I made it clear that Albertans will no longer tolerate the way we've been treated by the federal Liberals over the past 10 years," she said.

Smith repeated a number of policies she wants changed, including unfettered cross-boundary access to build pipelines and an end to the proposed greenhouse gas emissions cap, which Alberta says would hamstring resource production.

A day earlier, Smith told reporters she is skeptical that Carney can deliver. "I can tell you I'm not encouraged by what I've seen so far," she said. "I think there's a real danger that the new prime minister is worse than the old prime minister."

At the unrelated news conference in Edmonton later Thursday, Carney acknowledged the meeting with Smith and said he is committed to making Canada's oil industry more competitive.

"The commitment is to deliver projects like those that we agreed are national priorities," Carney said. "It's about getting, yes, pipelines built across this country so that we can displace imports of foreign oil."

Alberta NDP Leader Naheed Nenshi said Smith's threat of a national unity crisis is "childish" and "juvenile" and will fail to get any concessions from the federal government.

He said if the premier wants to keep threatening a national unity crisis, she should call a referendum on Alberta separation and resign if it fails.

Carney straps on skates

Carney spent the day in shoes and skates. Late in the morning, the former varsity hockey goaltender stopped by Rogers Place to skate with the Edmonton Oilers at practice.

Canada's 24th prime minister wore a blue Oilers jersey with the number 24 and his last name on the back. He spoke to coaches, joined players in a passing drill and shook hands with goaltender Calvin Pickard.

Also Thursday, Carney's office laid out $187 million in new funding to help rebuild Jasper. It's the largest funding package announced for Jasper since a runaway wildfire ripped through Jasper National Park and destroyed a third of the town in July.

Smith said she talked about Jasper with Carney.

"I made it clear that federal mismanagement of Jasper and Banff national parks resulted in last year's tragic wildfire in Jasper and is endangering Banff, and the situation must be rectified immediately," she said.

Carney also made an affordability announcement. The federal government is eliminating GST on new or "substantially renovated" homes sold for less than $1 million to first-time homebuyers.

The prime minister's trip to Edmonton came as all parties gear up to hit the hustings.

Sources say Carney is to go to Gov. Gen. Mary Simon on Sunday to dissolve Parliament and launch a federal election campaign.

Carney's Liberals will have their work cut out for them in Alberta. The party only has two sitting members in the province with Randy Boissonnault in Edmonton and George Chahal in Calgary. Both are seeking re-election.

Carney said he knows his party has a big hill to climb out West but said they will have a number of strong candidates.

Carney's visit to Edmonton, his childhood home, was his first since he made his Liberal leadership bid announcement in the city in January. Born in the Northwest Territories, Carney grew up in Edmonton before leaving to study economics at Harvard and Oxford University.

At his leadership announcement, Carney recalled lacing up his skates to play outdoor hockey at the Laurier Heights community league rink in west Edmonton.

"I can still hear the blades of the skates tapping on the floor as we try to get the blood flowing into our toes," he said at the time, joking about Edmonton's weather.