Prime Minister Mark Carney recently met with top oil and gas executives in Edmonton, signaling a shift in the government's approach to the industry. This meeting included discussions with 50 Liberal caucus members and key ministers, marking a departure from the previous administration under Justin Trudeau, which was often seen as antagonistic toward the sector.

Despite this change in tone, the oil and gas industry continues to grapple with stringent regulations. Companies face fines of up to $10 million for allegedly misrepresenting their environmental practices under Bill C-59, known as the "greenwashing" law. This legislation, which took effect on June 20, 2024, requires companies to ensure that any claims they make about their environmental impact are fully substantiated against vague international standards. Violations can result in penalties reaching three percent of a company's global revenue, a significant financial burden for large firms.

The law applies not only to public advertising but also to communications with stakeholders, investors, and regulators. This has led to a cautious approach among industry executives, who are now wary of making any public statements regarding their environmental policies. The legislation was initially proposed by former Ontario NDP member Charlie Angus and was embraced by the Liberal government, which has since intensified its scrutiny of the industry.

Carney's administration has attempted to re-establish the legitimacy of the oil and gas sector, with the term "pipeline" no longer considered taboo. However, some environmental advocates within the Liberal caucus remain silent, raising questions about their long-term support for the industry. As Carney navigates a minority government, he must balance the interests of various factions within his party.

The establishment of the new Major Projects Office in Calgary, led by Dawn Farrell, is a notable development. Farrell has a strong background in Alberta's energy sector and played a crucial role in advancing the Trans Mountain pipeline expansion. Her leadership is seen as a positive step for the industry, as she oversees all major projects across Canada.

Public support for oil and gas development has reportedly increased under Carney's leadership. However, significant obstacles remain. Premier Danielle Smith acknowledges that no projects will proceed without strong proponents, but the lack of backing is largely attributed to federal regulations. The prospect of a pipeline through Quebec or to Ontario via Hudson Bay appears unlikely due to existing laws.

One potential solution is a northern British Columbia pipeline aimed at the growing Asian market. However, this plan is hindered by a ban on tanker shipments off the north coast, a regulation that many believe should be repealed. British Columbia Premier David Eby opposes lifting this ban, complicating the situation further.

Additionally, the looming cap on oil and gas emissions and the need for revisions to the Impact Assessment Act pose further challenges for the industry. Until these issues are addressed, the message from the federal government remains clear: while the rhetoric may be friendly, the legal environment continues to be a significant hurdle for Canada's oil and gas sector.