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“Alberta can compete and be a significant supplier to the world . . . we are capable of competing on a cost-basis with anyone,” he said.
In an interview, Johnston said he anticipates oil demand will recover to around 96 million bpd next year, and then return to pre-COVID levels around 2022.
Johnston sees peak demand “more as a 2040 story than a 2030 story,” but said the critical question is where does Alberta and Canada fit into the future.
He suspects traditional oil-producing countries such as Venezuela, Libya, Iran and Iraq will lose market share during an energy transition period as investment eventually shifts to more stable jurisdictions.
“What investors are looking for are lower-risk, lower-cost and lower-carbon barrels. So if you can be (competitive) on that, then I think there still is some production growth,” Johnston added.
Finally, there are questions about government policies and the role they will play in the energy transition.
During Wednesday’s federal throne speech, the Trudeau government pledged it will legislate Canada’s goal of achieving net-zero emissions by 2050.
It will also “immediately bring forward a plan” to exceed Canada’s current climate commitment of cutting emissions by 30 per cent by 2030, initially set under the Paris climate agreement.
Speaking Thursday to reporters in Edmonton, Premier Jason Kenney assailed the federal strategy, saying it will impair the energy sector during a difficult period.
Policies including the new clean fuel standard also make it harder to attract investment into the province in areas such as new petrochemical and fertilizer plants, he said.
“In the real world where you can’t fuel airplanes, for example, or produce petrochemical products with good wishes, in that real world there will be tens and tens of millions of barrels of oil consumed in 2040 and beyond,” he said about peak demand.
“The only question then is, who will supply it?”
Chris Varcoe is a Calgary Herald columnist.