Heather Exner-Pirot: Canada’s Commodity Comeback, Energy Superpower Ambitions & the Arctic Challenge

Is Canada entering a new commodity supercycle — and are we prepared for what comes next?

In this episode of Power Struggle, Stewart Muir is joined by Heather Exner-Pirot, Director of Energy, Natural Resources, and Environment at the Macdonald-Laurier Institute, to explore the economic and geopolitical forces reshaping Canada’s future.

From uranium and mining stocks to LNG expansion and oil markets, Exner-Pirot explains why commodity cycles matter — and why this one could redefine Canada’s global position.

They discuss:

• The return of investor interest in energy and mining
 • Why oil demand continues to grow globally
 • LNG, natural gas, and British Columbia’s strategic role
 • Methane regulations and the cost of compliance
 • Carbon competitiveness and investment risk
 • Nuclear power and Canada’s uranium advantage
 • Arctic sovereignty, security, and NORAD modernization
 • What it truly means to be an “energy superpower”

This is a candid conversation about prosperity, policy, and realism in a world where energy demand is rising — not falling.

At a time of global instability and shifting alliances, Canada’s resource base may be its greatest strategic advantage.

The question is no longer whether the world needs Canadian energy — but whether Canada will seize the opportunity.

The energy conversation is polarizing. But the reality is multidimensional. Get the full story with host Stewart Muir.

Reach out to us with thoughts, questions, or ideas at info@powerstruggle.ca

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Transcript

SPEAKER_01 0:12

Welcome to Power Struggle. I'm your host, Stuart Muir. Today we're joined by Dr. Heather Exner Pierrot, a senior fellow and director of energy, natural resources, and environment at the McDonald Laurier Institute, which is based in Ottawa. Heather brings over two decades of expertise at the intersection of energy policy, indigenous economic development, Arctic and Northern governance, and resource politics. Welcome to the show, Heather. Heather is also special advisor. You're so busy to the Business Council of Canada, your research advisor to the Indigenous Resource Network, and your managing editor of the Arctic yearbook. How do you do it all?

The New Commodity Supercycle

Markets Shaping Politics

SPEAKER_00 0:51

I mean, they all overlap to a great deal, Stuart. So I always think of it as, you know, having a big 10,000-piece puzzle, and they all are different pieces of the puzzle. Well, what I'm really, I mean, there's so many things, but I would say where we are in the commodity cycle. I've been waiting, you know, commodities, just you know, to give some background for people who do not always think about these things. I think through through things through a lens of the commodity cycle and how much that impacts our politics and our economics, especially in Canada or especially in the West. And so they tend to take a generation. And we saw kind of the last big cycle was about 2000 to 2014. That was driven by, you know, a Chinese demographic change, its entry into the WTO and crash in 2014. And we all know the effects that had in Western Canada following the crash. And before that, it was largely driven by the energy shock in the 70s, post-World War II, those kinds of things. So I've been waiting for this next cycle for a couple of years. And I'm finally starting to see that it is coming. That definitely, if you look at indexes, it's here. Obviously, you know, post-Ukraine, there was a bit of a shock. It mostly settled down, but you've seen uranium do very well in recent years. You saw obviously gold and silver uh, you know, really spike last year. TSX just put out their uh top 50 performers of 2025, TSX V, which is a venture fund. 48 out of 50 were miners. Um, and their you know, collective, you know, share price of their stocks is more than 400% for those top performers. And finally, Stuart, very recently, probably only in the last month, where you've seen that real rotation out of tech into energy from kind of the generalist investors. So it's not a niche, you know, Eric Nuttle thing anymore. It's the generalist trying to increase their exposure uh to energy. And Canadian energy stocks are looking very favorable because they have those long life uh assets, those, those, those huge reserves. And so you're seeing them even exceed the valuation of American energy companies, which was, you know, very unusual historically. Aaron Ross Powell, Jr.

SPEAKER_01 2:51

Interesting. And do you see that as being a factor that's affecting political decision making? Because every day I hear some news about a project that's been canceled or it's delayed. So we've got this strange paradox. We have these conditions you've articulated, historic opportunity. But also we're shooting ourselves in the foot and other parts of the body at, you know, every every day.

SPEAKER_00 3:15

Aaron Powell Well, I mean, we are and we aren't. We are certainly not shooting uh, you know, every toe that we used to shoot, you know, under the Trudeau era. And so I would say, you know, I sometimes think, like, how could you have a Justin Trudeau? Like how what are the circumstances that allow for that? And it's not, it's not a surprise to me that his era perfectly paralleled the down cycle of the of the commodity cycle, that there was less cost to having Trudeau policies uh when the commodity cycle was not hot, when the sectors weren't making money, when investment wasn't flowing there. Um and obviously his policies, you know, kind of made that worse in Canada, but but the costs of that weren't exaggerated as they as they will be now. And so for me, if I say, you know, Carney's obviously changed his tune, obviously has embraced this, you know, lexicon of being an energy superpower. Obviously, when they're going to China, India, to Europe, they are leading with, well, we have oil, we have LNG, we have grains, we have oil seeds, we have critical minerals. That is obviously, you know, what potential trade partners want to hear. And I would just say that it is the commodity cycle that is creating those conditions that they're talking this way, not them leading Canadians to believe that actually commodities are good. And so I am optimistic because I feel like the economic factors will eventually override any contrary political factors, and the cost of not taking advantage of this commodity cycle will simply be too great. Now, oil is still low, you know, it's still in the 60s. It's the anticipation that we will, you know, soon be done with the glut, soon be done with abundance, and soon be entering uh, you know, a world of scarcity. And that is uh, you know, everything is easier in Canada when commodity prices are hot, the investment flows in. Obviously, good policies are a very important part of that, but there's a lot that high prices can pave over uh in terms of you know some governance issues.

Public Opinion Turns Toward Energy

SPEAKER_01 5:09

Aaron Powell He alluded to one thing, which is the uh abundance of resources that Canada has got. And in recent months it feels like there has been a recognition of this long life, particularly oil sands, but but really the amount of of shale that we have, especially in in Western Canada, although there's some shale resources elsewhere, isn't there in Quebec. But um what what do you think it needs to happen on the part of the public to recognize what it means to be this sort of storehouse with the potential to become a superpower?

SPEAKER_00 5:42

Trevor Burrus Well, I I mean to some you know, I I don't think we're at the beginning of this game. Obviously, you know, Stuart, our jobs, you and me, were a lot harder three or four years ago, where people almost had no idea. You know, I'd never heard of Lamontni, um, you know, thought that the oil sands caught cost us money or something like that. And now, I know and we've seen this has been very gratifying the last year since Trump came into power, really. Public opinion on oil and gas in Canada has has changed enormously. That of a majority, in some cases, you know, a very large majority, uh acknowledge that oil and gas is important, think it will be continue to be important, and want to see, for example, a new pipeline. Um, and in particular, LNG and natural gas are even more favored than oil. Um, and you see in the BC provincial budget, you know, it's so obvious, you know, that it's now the most important source of uh of resource revenue. The potential to expand all the LNG projects that we have in the queue right now is probably the easiest or the only way that BC is going to start to crawl from under, you know, the deficit that it's created. Um and so and so I see it happening. You know, I I do I see it happening already that people are recognizing. Uh, and I think it helps that on the world stage, you know, when you go to China and India, what are they asking for? You know, mostly crude oil uh and a handful of other things. Uh, but it's certainly, I think it certainly, you know, punctuates for people that this is power. Uh, you know, this is the one source that Canada has to go and either create new alliances or to defend against, you know, some other, you know, actors that we might need to defend ourselves against. So I see that I'm I'm optimistic because I think people are starting to get it. And no one likes to be weak and poor. Uh, and the more that these prices go up and the more that there's scarcity, people will see that they're an opportunity for prosperity and for strength.

LNG Promise Versus Gas Bottlenecks

SPEAKER_01 7:34

Aaron Powell You you've touched on the the pivot represented by Mark Carney. I mean, he's really leaned into it. And I I think there was a moment when he made his now famous Davos speech. You know, I've had friends from uh different countries who don't probably pay attention to Canadian news, you know, message me in Facebook wow, your prime minister is uh um amazing. And um I uh began I began to hear business executives who were in that group which which was, well, he he's saying the right things, but uh let's wait for him to do the right things. Uh uh write at that Davos speech, people heard that, and they I think really um in a lot of cases had this moment where it was uh you know what I'm gonna give him the benefit of the doubt that he's gonna deliver on these things. So let's go. And that's this mood shift. Do you feel there's something like that going on right now?

SPEAKER_00 8:25

I uh absolutely stuart, and I and I felt the same. I liked the Davo speech. Like it's pure realism. That's kind of my brand of international theory. Um, and it was based on, you know, being an energy superpower, critical minerals, AI. Those are the things that I want, you know, us to do. And I'm delighted actually that he said it on that world stage, and so many people heard it because I feel like it'll be so much easier to hold him accountable to that version of Canada that he sold to the rest of the world. And I think Mark Kearney does care about how he is seen on the world stage. And I think it will be hard for him to go back to Davos Nier and have failed on all the things that he described Canada's potential to be. So, so I'm encouraged by that. I think there's a lot of pressure on him to deliver that. I was just in Singapore two weeks ago for the Canada and Asia conference. Uh, I thought, you know, this my first time, and I thought this will be a great year to see how people in Asia are responding to Canada, thinking of Canada. Like, like you said, many of them were very positive to Carney and to the Devo speech, uh, and have a sense that, yeah, there's things happening, that we can get things done. The uh trade agreement with the ASEAN uh bloc is is probably going to be concluded this year. But of course, trade agreements doesn't mean trade, it means the potential for trade agreements. So, so meanwhile, in Canada, there's still a ton of work to do. In a way, we're doing the easy part is very important, the rhetoric, the culture change, the shift there. But when we're talking about commodities, it doesn't matter if the logistics and the investment aren't in place. So I do feel though that Stuart, that people like you and me can now say, well, you've said all these things, and now A, B, C, D to actually make them happen. Uh we can get into, you know, some of the ways in which we are manifestly not moving towards being an energy superpower on the policy front.

SPEAKER_01 10:16

Yeah. Well, let's leave those things aside for now or even for today and get into things that maybe um what what are the things that we could help and those who do work like us who are looking for ways to be part of this push, what ABC, what do you think uh we could do?

Methane Rules And Investment Math

SPEAKER_00 10:32

Well, I mean, for one, like for me, and I think for you, is is one make the average Canadian excited about our resources. And it was too long where it was diminished, um, looked down upon, frankly, uh, from you know, a particular, you know, portion of the political elite uh and seen as backwards or 20th century uh, you know, uh economy and not the 21st knowledge economy that we're trying to get to. And I I will never get over this, you know, Justin Shardot saying in 2016, you know, my predecessor wanted you to know us for resources. I want you to know us for resourcefulness, as though people in the resource sector aren't resourceful. But that has shifted. Uh, and again, and again, it's still butting up, I would say, against some, you know, this is still a power struggle uh in Canada. There's there's some you know aspects of the elite that don't benefit from resources. And certainly in Western Canada, we benefit more from from this shift more than people out east do. Uh, and so that will obviously create some tension. But making the average Canadian proud of our resources, uh and thinking, you know, understanding that they're extremely global leading on the environmental side, on the social side, I think that's important. Making people fluent, as you said, in the language of commodities, of trade, of geopolitics, uh, just increasing the literacy on these things. And I think that has, you know, with Venezuela, uh, with the Trump tariffs, like people, you know, I heard people talk about pad three refineries.

SPEAKER_01 12:05

I heard people, you know, go your taxi driver, your Uber driver is telling you about pad three.

SPEAKER_00 12:11

Exactly, exactly. So the literacy has really increased. Um, and then I'll say just the last thing. I think a lot of people understand that maybe, you know, the regulatory framework is hard, or we need to improve the regulatory framework at some level, but very hard to get specific on that. You know, what is the actual policy? What is the actual regulation? What is the actual problem? Uh, and so I think communicating to people as much as possible, these are the specific issues that government needs to address. It costs yay much. It would unleash this much in investment, create this many jobs, and uh, and making that concrete for people. The last thing I'll say is, you know, you can talk about, you know, oil making whatever, 8 billion, 12 billion, 25 billion. You know, if you can say this is 130 hospitals or this is 10,000 nurses, those kinds of things that people feel, oh, that would improve my everyday life. It's not just about corporations somewhere, but this would improve my community if we did more of this?

SPEAKER_01 13:11

Aaron Ross Powell If you look at uh British Columbia specifically, it's not just one province of Canada. It's the province that so much of the nation's um uh trade goes through. And if it doesn't go through uh that that uh province, uh it doesn't go to market, at least the market where it's most valuable. How do you think uh the rest of Canada outside of BC sees BC as fitting in? Because there is this level of consciousness uh right now.

Carbon Pricing, Caps, And Leakage

SPEAKER_00 13:39

I'll say, you know, from a Saskatchewan-Alberta perspective, which is where I mostly sit, it's frustrating. It does feel like we are landlocked and and the thing between us and making more money is literally kind of BC. Uh and it's you know, the ability, you know, the inefficiencies at ports or the inability to buy to build pipelines. Like those are like farmers in Saskatchewan know about BC ports. It is kitchen table discussion. Um, so so finding ways, you know, to prioritize that. And and maybe for BC, it's not as important because it is just a, you know, I don't know, maybe it's just a port for you, but for us, it's you know, all of our exports are going through there. So you're, you know, whether your port is more efficient, it's it's sending other people's commodities and goods to some extent uh out into the world and a bottleneck doesn't immediately impact you like it does for, you know, propane producers or or or you know, canola uh and that kind of a thing. And then, but but for sure, and you have to, you know, there has been a tone shift. Everyone appreciates that, especially on LNG. Uh, and so that, you know, that people celebrated the startup of LNG Canada. And there seems to be more optimism uh that we could celebrate, you know, an FID on LG Canada phase two and on on Silims and move towards that. But we're celebrating LNG, but we're not celebrating natural gas. Uh and that's the, you know, I would say that's, you know, from a Calgary perspective, that's the prop, that's the problem now. I'm happy you're happy about LNG terminals, but we need to get natural gas to liquefy at LNG terminals, and it's still very difficult, and there's still a lot of roadblocks to extracting the amount of natural gas we would have to in BC and northeast northeastern BC to fill up all those terminals. And so that's kind of the next, the next stage of, you know, you can't attract these terminals and at the same time make it harder to actually extract natural gas.

SPEAKER_01 15:39

We had a meeting recently uh at at ResourceWorks, that uh is the organization that presents power struggle with the Energy Minister of British Columbia, Adrian Dix, and we were very happy to hear him say that in 2026 he'd be focusing on the upstream. The upstream is where the gas comes from, and you have to drill all those wells to get the gas out. You know, in Texas they've had something like 6,000 wells drilled in the last year, I think is uh a stat I heard. And in BC, for LNG to happen, the truth is you need to have at least 500 wells drilled every single year to supply that gas. And we've had some congestion on that front, haven't we?

SPEAKER_00 16:19

Yeah, well, uh absolutely there's been congestion. Um and I, you know, I mean there's been some pipeline, you know, projects announced. And so I think there's at least some movement on the on the pipeline side, which were fully within BC, under the BC regulator, don't need the Canadian Energy Regulator uh to interfere too much, although there's some that you know cross borders that the CR did have to interfere, but billions of dollars being spent on increasing pipeline egress for natural gas in BC. So that's very bullish. But again, it still comes down to the competitiveness of the commodity uh and getting that natural gas in, who are going to have to pay the tolls, who are going to have to, you know, pay all the expenses uh and make a profit by the time it reached Asia. So, you know, there's absolutely, you know, we talk about the blueberry decision. So that was an important, you know, case involving a First Nation in Treaty 8, uh, where we were to talk about cumulative impacts. This is a phrase that, you know, sends some shivers up some people's spines of cumulative impacts. The idea, you know, that it's not, you don't just have to worry about the impacts of your oil, of your oil or gas operation, but you have to worry about how that, you know, has accumulated on every other thing that's been done in the last hundred years. And it's still poorly defined. Um, and there's still a lot of room for interpretation. And so that's so so that, you know, causes uncertainty, even though people are working very hard to make good relations with uh, you know, the First Nations in the Treaty Aid area. And then the methane regulations. I would say, you know, those are kind of two very um two very large sources of uncertainty that the federal government has has implemented final methane regulations that look to be extremely aggressive, extremely ambitious. CAP has said it's going to cost the industry$14.6 billion to comply with it. Um, and the ECCC models seem to be very divorced from the reality on the ground of how easy it is to accomplish those uh very ambitious goals they have. These are things that I don't think you we can we cannot we cannot reach our LNG ambitions until those things are more settled.

Rethinking Hewers Of Wood

SPEAKER_01 18:23

Let me ask you this then, Heather. If Canada uh adopts these stringent climate policies, and then the industries that are able to operate in those conditions do so. Will the things that Canada produces and exports get a premium on international markets for having this climate commitment built into them?

SPEAKER_00 18:47

Yeah, so so great question, Stuart. And and the answer is that there isn't a premium uh really. There's you know, there's not a different benchmark price for a low-in-intensity natural gas uh product. And it absolutely isn't an oil either. Now that being said, our biggest customers in Asia are Japan and South Korea. And they do have the you know a commitment to to you know you know climate targets and and the prosperity, frankly, to be able to pay a little bit, uh, to to want to secure. So all other things being equal, I think it is attracted to them uh that that you know Canadian LNG is is is has a much lower intensity than than other competitors. But the fact is we're already there. We already have that lower carbon intensity. So so we're already, you know, whatever kind of uh you know premium you get just from the fact that we're you know we might be their preferred supplier, yeah, even though, you know, at some level cost is is going to be king. That is already in place. And so further restricting methane um, you know, you know, flaring or that kind of thing, which is very minimal at this stage, by the way, it's much more of an issue in in oil fields, not natural gas fields, because methane, you know, if you can capture uh methane, that's just more natural gas that you could sell. So so which is to say, I think we've captured any benefit or premium, um implicit premium that you might get already. Trevor Burrus, Jr.

SPEAKER_01 20:14

Right. So is there an overhang from the the previous approach of the pre-Carney government that is still working through that system? And that's what we're dealing with here, that we need maybe some resolution to today's realities?

Diversifying Beyond The U.S.

SPEAKER_00 20:27

Aaron Powell Well, I mean, there was a very aggressive, ambitious methane target already under Trudeau. Uh and in their defense, it was, you know, wildly successful. Certainly costs, you know, money. But but all the low-hanging fruit uh was was, you know, all the things that industry could do at a reasonable cost, they did it. Um and and did you know produce you know incredible gains in lower carbon intensity and things that the industry is very proud of. Frankly, we're all proud of it. So it's not as though people are opposed to doing it. It's just with this, with a new set of regulations that have just been introduced, um, if the burden, you know, you're getting the burden is getting to beyond a point where you can be competitive, uh, where you can attract investment, or you can do what's technologically feasible. Uh, and so it's it's getting much harder and more expensive to get incremental gains now because there were a lot of gains made uh already. And there doesn't seem to, you know, and I and I feel like maybe from a bureaucratic perspective, there's a sense that, well, you just you just did it, so just do a little bit more, and not appreciating that, you know, the easy things have been done and and and figure out that last 30 or 20 percent of emissions is by far, you know, you know, multiples more expensive than figure out the first 10 or 20 percent of emissions that you can get rid of. So people may not appreciate that most of natural gas is methane, about 90% of natural gas is methane. So if you know the the cap the trick of capturing methane is that if you don't if you don't, you know, uh transport Natural gas, it's very hard to do. So, in an oil field where you are releasing it or flaring it, it's because you have no ability to capture natural gas. Now, if your primary product is natural gas, then it's easy. You actually want all the methane that you can capture. And so there was a big incentive to not flare and to be able to capture that instead. And also electrification is another way that we're trying to reduce, you know, the use of using the actual, you know, natural gas to power uh actual operations and to use electricity instead. That requires BC hydro to come on side, by the way. So there was these ambitious targets in 2018. They've worked quite well. Emissions dropped, but you know, it would go quite precipitously. We met all of our targets ahead of time. Now the government has introduced new methane regulations just in the last month since the Alberta MOU. It has different targets than the Alberta MOU. It has different timelines, uh, and and I would say it seems to be very expensive. CAP estimates it'll cost$14.6 billion to comply with them. The Canadian Gas Association estimates it'll cost them$3,000 a ton to mitigate. Uh meanwhile, ECCC, the Environment and Climate Change Canada, thinks it'll be about$48 a ton. So the discrepancy between what government thinks is possible and reasonable and what industry thinks they can do with the money they have and be competitive is a huge gulf right now.

SPEAKER_01 23:21

And why will it be so expensive in the view of industry?

SPEAKER_00 23:24

The low-hanging fruit, the easy things that you can do to capture methane have been done. Uh, and now we're into a stage where you know you either need new technology or you need infrastructure. Uh, and and it just, you know, eliminating the last 10 or 20 or 30% of emissions from a sector is going to be multiple more expensive and hard than eliminating the first 10 or 20 or 30%. And that's where we're at now is we've eliminated probably more than any other country, any other sector in any other country, so much of our methane that you're really getting to the point where we need new technology. Technology doesn't yet exist, uh, and it would be very expensive to do so. And I will just say there's a lot cheaper ways in the rest of the Canadian economy to get rid of those emissions. So it does feel like you're just targeting one particular sector to have to spend a lot of money on reducing emissions when you could do so in other parts of the sector much more cheaply.

SPEAKER_01 24:17

So, how can Canada get greener for cheaper?

SPEAKER_00 24:19

Well, I mean, this is the question we should be asking ourselves every day. And this is why there was such a strong reaction against the proposed oil and gas emissions cap, these methane regulations, where where the the government has committed to an industrial carbon price, it doesn't think that it can get rid of all its, you know, meet its Paris commitments just with that. So it's layered on special regulations on top of the carbon price to particular sectors that it that it feels fine, you know, attacking uh versus others. Obviously, it's oil and gas. Those ones are sp facing very special targeted regulations that that most that impact them and other sectors get a bit more of a free ride. So that's where it drives people nuts, is it's the pancaking of the regulations, and it seems to be a sense that Ottawa is prepared to do anything to reduce emissions from those sectors regardless of the cost.

SPEAKER_01 25:11

So if you were in an elevator ride with the finance minister right now and you wanted to make an impression, like what are the things that uh Canada could do to get to where it wants to go aspirationally, but also do that in a way that that keeps jobs happening?

Oil Demand Reality Check

SPEAKER_00 25:25

Aaron Powell You know, this is it's my understanding is true that ECCC's models for when it runs these climate policies is that it assumes perfect competition and assumes that the oil and gas sector, any sector, will spend money on decarbonization right into the point of zero profits. That if you have a policy that forces them to do so, they will do so until they're not profitable. In the real world, of course, you do need profits and your investors need to see profits to invest. And so in the real world, those policies mean that you shut in production and you don't get investment, you don't get jobs and you don't get exports. So trying to explain that yes, the sector wants to be proactive, yes, the sector wants to be a good, you know, corporate citizen, but you cannot pass the threshold at which they're not competitive and at which they cannot attract investment. Um, and when you do that, you have the phenomenon of a carbon leakage that instead of investing in good, I would say, wholesome, you know, Boy Scout Canadian oil and gas sector, people will just invest in energy sectors in countries where they don't have to pay that burdensome decarbonization premium. Uh and the world gets more global emissions, Canada gets less investment.

SPEAKER_01 26:35

The Globe and Mail, Canada's national newspaper, just came out with an editorial. A lot of people who do the kind of work we do, I think we're quite cheerful to see this headline called In Defense of Hewers of Wood and Haulers of Water. Let's talk about that. Because you were mentioned, Heather.

Canada’s Nuclear And Uranium Edge

SPEAKER_00 26:50

Yeah, I was mentioned, and it was it felt like my Twitter feed had come to life in a Globe and Mail editorial for because it because it is what I've been harping about, you know, for the last two years. And again, it's the idea that, you know, some people are embarrassed by natural resources, think it's low-skilled labor, think it's, you know, uh weakly productive. And this goes back to Harold Innes and his staples theory, and it's kind of really driven a sense of Canadian economic theory for a century. And most university students in economics and even political science will be taught it. But it's it's the idea that you want to move from these primary industries producing raw materials. Uh, at the time in the early 20th century, it was described as hewers of wood and haulers of water. Uh now today it would be farmers and and drillers and miners and move to manufacturing and then to services. And for some economists, this, you know, reaching services is this holy grail. You're really an advanced knowledge economy when you're doing tech and everything else is, you know, from developing world status, you know, up to, you know, kind of United States status. And there's been embarrassment, I think, in Vancouver and Toronto and Montreal and Ottawa, that Canada still was known for its resources, for its hewers and for its haulers. Uh, and for me, and for this article, uh, which describes it, you know, beautifully, is the extent to which our resource sector is a knowledge economy, the extent to which it is capital intensive, and the extent to which is normally the most productive sectors of our economy, actually. And I don't think Harold Innes had in mind in the early 20th century, you know, how technologically sophisticated farming would get, or that mining would get, or the oil sands would get. And I don't think what we knew about natural resources, you know, in 1910 or 1930 is a good way to drive our economic policy today.

SPEAKER_01 28:42

Aaron Ross Powell Would you say that the knowledge, the technology, the innovation economy in Canada is almost one and the same as the natural resource economy?

SPEAKER_00 28:52

You know, these are true facts that Calgary, for example, in the last boom had the highest per capita number of engineers in the entire world. Uh that, you know, what we're it's I think people who who haven't seen or aren't exposed to natural resources think it's easy. I think they think what farmers do is low skilled and easy. I think they think what miners do is easy. And if there's this oil in the ground and anyone could get it out. Um and in in fact, the commodities markets in this world are cutthroat and ultra competitive because because they are an equivalent product no matter where you are in the world, and so you're only competing on price. Uh, and if you can't compete on price, you can't compete. And I and I do think, you know, in Canada, we're a little bit comfortable, we become a little bit, you know, you know, complacent about some things, you know, our geographic position, our economy. But I'm telling you that people who export commodities are always, you know, adapting, are always innovating, are always on the run because it is so cutthroat competition. Uh, and I think, you know, moving that, you know, and and that is why I think we're more entrepreneurial, more ambitious, I think, in the natural resources sector, why you're constantly optimizing, constantly becoming more efficient, is because you have to. And it's kill or be killed, uh, eat or be eaten. Uh, and and I would like to see that culture actually translate to more sectors in the Canadian economy.

SPEAKER_01 30:15

The natural resources sector is an enormous natural advantage for the Canadian economy, not a defect to be remedied through subsidies and tariffs on manufacturing. Um, kind of nails it, doesn't it?

The Arctic: Costs And Security

SPEAKER_00 30:27

It it does. And it does feel like, you know, there's one put you know portion of the economy that is is meant to be protected and insulated, and another sector, you know, that's just you know, just wants markets, you know, just please provide us access to markets so we can compete. Uh, and and obviously in the long term, from an economic perspective, it's obvious which one is going to be more productive and create more exports. But I have been very gratified, just read an article from a European paper today uh to appreciate what an advantage it is in this world, Stuart, to be resource intense, that same thing that embarrassed so many people for a decade. That the Canadian economy is an advanced economy, but most of our trading partners are energy and resource importers. And we happen to be an energy and resource exporter. That means we are far more complementary to Europe, to China, to India, to Japan, to Korea, to the United States than they are in many cases with each other. Whereas they're competing with each other for advanced manufacturing. We are providing raw materials to all of them. They all want more from us. Uh, and in this particular geopolitical era and in this particular stage of the commodity cycle, it is such an advantage. It's hard for me to feel pessimistic, even though I know there's regulations and infrastructure and things we have to do. But the cards are lined up so well for Canada in this moment. And I really feel like that was missing was that ambition uh and that pride in uh in our resource sector. And finally that is starting to match up too.

SPEAKER_01 31:59

So if you looked at the scale of this challenge, you know, we've got advantages, like you say, where uh people need Canada and they they want more Canada. Um also we have the uh productive capacity, the universities, the skills, this recognition of uh having that capacity to to be there and and serve that need. And now we have an external factor with a trading partner that we rely on so heavily that we we have this great uh turmoil with now, and we've declared as a country we're going to pivot. People rot my knuckles when I say pivot, or let's find another word, I guess. We're we're going to expand our foreign trading. Yes. Um but when you look at the numbers, uh you know, if 99 percent or 98 percent, whatever the stat now is, say, of our most valuable exported commodity, which is crude oil, goes to one country, the United States. Um like suppose you got 10 percent, you're still uh n almost 90 percent going to that one country. But getting to 10 percent would be a gigantic thing that would require new oil pipelines to the coast, and we're told that those can't be built. So um how are we gonna bridge the ambition? That's just one example, but also critical minerals and you know the all this talk of a copper smelter, which sounds like it would be a fantastic thing for Canada, but you know, how do we get there? So these these big issues, Heather, how do we how do we bridge the gap?

Royalties, Budgets, And Misconceptions

SPEAKER_00 33:23

I mean, great question. I'll say I haven't heard a single commodity producer say they want to sell less to the United States. So no one wants to pivot what they're already selling. Fantastic market, you know, easy to work with, other than Trump, you know, outside of Trump, but there's still companies easy to work with, states easy to work with, municipalities easy to work with, um, and and Trump won't be there forever. So don't want to lose that market. In fact, you know, seeing some opportunity for expansion, certainly on on minerals and and oil and natural gas. But for real growth, and I had, you know, I had to say, Stuart, you know, the United States economy, you know, maybe close to plateauing, uh, or or it'll be moderate growth, you know, in terms of demographics and that kind of thing, just compared to Asia, where, you know, it's, you know, I don't know, eight times more population, more than that, I think. So four and a half billion people in Asia, I think there's 400 million in the United States. And not only is is the population just simply bigger, many of them are moving from a lower income level to a middle income level, which by definition means more material consumption, and that it's still the fastest growing population in the world. So what was 4 billion will soon be 5 billion. So the growth that you're going to get from orienting to Pacific Tidewater through BC, through the ports that we have in BC, uh is really the growth story, even as you don't want to lose anything from the United States market. And that is where Western commodities, where frankly, where our oil, our natural gas, our uranium, our potash, our grains, our oil seeds happen to be based, our metallurgical coal, uh is naturally would go west, would not go to Europe, would not even go to uh eastern uh United States. And so I had good news for you, Stuart. Uh, in the last, in October, November, the last two months available, the accude oil exports from Canada were 84% to the United States. The rest was to countries other than the United States. A huge jump because you're right, historically before Trends Mountain, it was about 98, 97%. Trends Mountain is almost full uh as part of it. It was 92% full uh in the end of January. And we had some re-exports out of the Gulf Coast, things that were were going through the United States, not to the United States, and getting re-exported to other markets. So, you know, it's it's like Jurassic Park, you know, uh nature finds a way, it'll trickle. Crude oil is is is like that. Crude oil will find a way.

SPEAKER_01 35:53

That's extraordinary news. Um, 92% full. Um in in BC, in our microcosm of media coverage, you often hear uh, oh, that pipeline it's it's empty. It'll never be full. No, who would want uh this terrible product that the world doesn't want? What's happening in reality, uh in a nutshell, Heather, is is the world using oil today or is it phasing out oil?

SPEAKER_00 36:16

The world has never used more oil. Uh and and this is just, you know, has been a feature of human civilization for decades. Other outside of pandemics or financial crises, more people, population growth translates into more energy use. And so every year you just have more people and you just have more energy use. And so you expect about a million barrels per year to be added every single year. That's roughly what we expect in the next few years. There obviously was a sense, I would say, five years ago, coming out of the pandemic, where there was a drop in oil use, that maybe it had plateaued, that the rise of electric vehicles in China, which had been the fastest growing oil market at the time, was, you know, uh, you know, uh precipitating, you know, this decline in plateau and oil. Uh everyone has recalibrated those projections, those forecasts in the last two years, such that this week, you know, the International Energy Agency was meeting. Obviously, there's now Chris Wright is the Department of Uh Energy Secretary with a very different message than you would have had uh, you know, under the Biden administration. And they recalibrated so that their top focus, once again, is energy security. Um, and so even with the IEA under a current policy scenario, they don't see the plateau before 2050.

SPEAKER_01 37:31

You mentioned Chris Wright. Did he have anything to say about net zero?

SPEAKER_00 37:34

He did. He said there was 0.0% chance we'll hit net zero. Uh, and I think any objective analyst would have always said that. There, you know, there was no trajectory. There's uh not enough critical minerals being developed, not enough electricity being generated, that you could transition off that kind of energy. And the idea that people would voluntarily and willingly just use less energy, just do less, uh, this foundational pillar of the economy, I think was wrong. That maybe you could convince a few rich Western countries to do so for a handful of years, maybe. Uh that turned out to be politically fraught as well. But in the developed world, uh to cap people at the level of development they're at now and say no more energy, that was never going to be politically tenable.

SPEAKER_01 38:22

In Canada, is there a law that says we must get to net zero by 2050?

SPEAKER_00 38:26

Aaron Powell So I think that that law hasn't been rescinded as far as I know, Stuart. Um, but obviously the targets will have to be adjusted. And obviously, I think everyone has acknowledged Canada will not be meeting its Paris Agreement climate targets.

SPEAKER_01 38:40

And do you feel that the uh million barrels a year you say are added to how much oil the world consumes will increase for a long time, or will it sort of plateau at some level?

SPEAKER_00 38:52

So I'm convinced that energy use and population growth run in parallel. And we do foresee that population growth will plateau, actually, probably in the 2050s or 2060s. China's population has already plateaued. Europe's is in decline. Um, in Canada and the United States, the only reason we're still growing is because of immigration. Uh, and you just see birth rates have have really taken a toll around the world. So there is absolutely a scenario this century where your population starts to decline and therefore your energy use starts to decline. Now, that being said, rich people will use as much energy as they can afford. Uh, everyone will use as much energy as you can afford. So you could see an increase in per capita energy use. And imagine, you know, uh, you know, in a regular society moving from, you know, first you get, you know, appliances, then you get, you know, a scooter, and then you get a, you know, one car for the family, then you get two cars for the family, and you get air conditioning, and then you go on some airplane trips that you haven't gone before. And now it add in AI. And so we'll see how much, you know, will people just use more and more AI as much as they can use because the return is so good. Uh, and in that case, you will see energy maybe uh increase at a faster pace than population.

SPEAKER_01 40:07

So energy use is going up and up and up.

SPEAKER_00 40:10

Yes. And it's it's still a question of how much of that will be crude oil versus electricity. Electricity is definitely outpacing oil now. But oil and natural gas use absolutely, you know, are still going up. Um, and they're just, you know, it's just hard to compete with storable, uh, you know, energy dense materials like that that are still today at pretty cheap prices.

SPEAKER_01 40:30

Aaron Powell Give me the story of your your favorite Canadian green energy. I'm talking about nuclear, of course, because uh I th I think you you spent a lot of your life in in in Alberta, but you have some really special Saskatchewan routes too. And Saskatchewan fits into the story. So just for someone who just moved to Canada, uh, what's the Canadian uh nuclear story, including the the fuel for it?

SPEAKER_00 40:55

Yeah, absolutely. So Canada is, you know, kind of a preeminent nuclear producer in power. I think we're the sixth biggest producer. Almost all of that is based in Ontario. But we developed, you know, a few decades ago a made in Canada uranium uh nuclear reactor that uses not enriched uranium, it uses natural uranium. And that was a great solution in a time where we were worried about uh you know proliferation of nuclear weapons, is here you could have a reactor that didn't require enriched uranium. That's the can-do. Um, and so and so we still do that, but in Saskatchewan, to your point, is where we have the Athabasca, this is with the Athabasca oil sands, but there's also the Athabasca basin for uranium. And it is the world's richest uh uranium field, uh, ultra-high grade, uh, which, you know, on average, you're getting 17 or 20% of what you're mining is uranium, which is a phenomenal grade for any ore. There have been drilling samples that come out 50% uranium, which is, you know, unicorn levels. Uh, and we are the world's second biggest producer and second largest exporter. And there is a nuclear renaissance. And so you're already seeing some demand. You're seeing announcements of new nuclear reactors. I just heard in the last month, last year, actually 2025, was a record for nuclear-produced electricity. Even if it's declined in the West, it has continued to grow in Asia. Uh, and we expect much more nuclear in the future because it is a you know a dispatchable baseload source of clean electricity. Uh, and even on the expensive side, if you can get the cost down, that would certainly be the answer to this energy demand uh we just described. And so we are producing a ton, we've hit record production in the last year. And one new uh uh mine was just approved, uh finally got all of its approvals just yesterday. There's probably one other mine that will get that within the next month or a few months. And so I do anticipate, everyone anticipates Canada will actually grow its market share in uranium from an already high level in the coming years. And that is probably our most strategic um uh resource because we because we just have so much market power with it.

SPEAKER_01 43:01

Aaron Powell Let's talk about the Arctic. You you're a bit of a specialist in that. Um what is the uh importance of the Arctic to those of us, the more than 90 percent who live in the south within 100 miles of the U.S. border?

SPEAKER_00 43:14

Aaron Powell It's 40 percent of Canadian territory. And I think we often have the idea that, you know, it's you know, there's a scramble for the Arctic and it's just unlimited resources. Uh and if we cared enough, we would go in and do it. But if we don't, then China will just go in and and and mine it anyways. And in actual fact, there's a reason why we haven't developed our Arctic to the same extent as Provincial North. It's just more expensive to develop things in the Arctic. And people have had, you know, one or two bad cold days, you know, this winter, you know, snowy. Uh obviously in the Arctic, it's you know, a hundred times that. My husband actually works at a mine uh in the Arctic and they just had their coldest day in seven years. Uh, and that certainly makes operations difficult. So, on average, Arctic mines will be about two and a half times more than. Than a southern Canadian mine. Southern Canadian mines are not the cheapest mines in the world either. So you need a very high commodity price to make an Arctic operation justifiable to attract the investment and to build it. We've tend to only be able to do that with gold, which doesn't require a lot of infrastructure. So the, you know, the threshold is much lower, and gold prices are good in diamonds, which is really what's driven the Northwest Territory's economy. But that commodity price has slid. And just recently, uh high-grade iron ore. It just happens to be very close to Tidewater at the top of Baffin Island. And they just announced a huge expansion, probably three or four billion dollars to build a new railway and a new port that will allow them to quadruple or quintuple production. But those are few and far between. And that one benefits from being already close to tidewater. So you don't have to build, you know, a three or four hundred kilometer road right through, you know, the tundra.

SPEAKER_01 44:54

Now, in terms of military power and security, what's going on in the Arctic Ocean that we should be concerned about in Canada?

SPEAKER_00 45:01

Yeah, so what we so you know, always this fear of losing our sovereignty from an international legal position. No one else is claiming the Canadian Arctic. That's not really the problem. The real security threat is not China or Russia landing troops and taking over things because we didn't have enough people of our own there. Um that would be extremely difficult, you know, logistically, for anyone to go into the Canadian Arctic. The real security threat that we're concerned about is basically hypersonic missiles going over from China or for Russia through that vulnerable northern flank that we can't monitor as effectively as we should, and coming to hit southern targets, cities probably in the United States. And so that's why there's been such a push for NORAD modernization. That's why the United States is pushing the Golden Dome. The idea is to prevent uh and deter any potential missiles from coming over that flank because it seems to be the most vulnerable one, the most likely approach uh that an adversary would use. And even if they don't have an intention, the threat that China or Russia could hit an American city if they wanted to, that that really ties your strategic hand. And so the United States can act much more forcefully uh in some of these situations if it doesn't have that threat, you know, kind of over its head.

SPEAKER_01 46:18

Does that keep you up at night?

SPEAKER_00 46:19

Uh you know, every time you get a briefing, it does keep you, you know, our relations with China right now feel pretty good. Russia feels, you know, pretty weakened. Ukraine's doing pretty good there. But in some ways, that's you know, that's also a dangerous situation, is if people feel like they have nothing left to lose, um uh, then they do irrational, uh rash things. And so absolutely, you know, that is the most existential threat to our security uh and defense, frankly. And uh, and we're planning to spend money, and that's you know, where you talk about urgency, Stuart, we've known about this threat for years. Um that is, you know, should it's absolutely top of the list. I'm glad to see it. Looks like we're doing a few things for it.

SPEAKER_01 47:02

You get outed about a lot. You're very high profile in media and social media. What's the most common question you get that uh surprises you that people are asking you so much?

SPEAKER_00 47:12

Uh you know, the one that drives me nuts is is still about you know, oil and gas subsidies or, you know, or not making money for people, you know, that's corporations that get it uh and not people. And I just, you know, I just like look at a provincial budget, look at royalties, look at the BC budget. Like, why do countries mine, why do we choose mining in oil and gas over tourism uh or services? It's because only one of those gives royalties. Royalties are so important uh to provincial budgets. They provide such a high quality of life, a higher quality of life for residents than they otherwise would. And I, you know, I'm always surprised that in Canada, we, you know, people still don't appreciate the role uh that extractive resources plays in our quality of life.

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SPEAKER_01 47:57

Heather, thanks so much for joining Power Struggle and for sharing your deep insights into Canada's energy future, all of the topics we've covered today. It really adds up to national prosperity and the lives of ordinary Canadians. This is, to me, not some abstract uh work for uh energy nerds. This is really who we are as Canada. And uh really appreciate you can be part of the conversation. If you enjoy this episode, please make sure to subscribe to PowerStruggle, Spotify, Apple Podcasts if you're listening to it, YouTube as well, if you're watching the show, wherever you get your podcasts. Sharing the show helps us bring more serious, honest conversations forward about energy, about policy in Canada's future to a wider audience. And you can find out more by going to powerstruggle.ca. All the past episodes are there. We're also on YouTube. You can look in the archive there. So thanks for listening. Stay curious, stay engaged, and we'll see you next time on Power Struggle.