Canada Unveils Plan to Reduce Pollution in Oil and Gas Sector

The Canadian government has introduced a preliminary framework designed to limit emissions from Canada’s oil and gas sector.

The Regulatory Framework for an Oil and Gas Sector Greenhouse Gas Emissions Cap proposes reducing emissions by 35% to 38% by 2030 compared to 2019 levels, offering flexibility to emit up to 20% to 23% less than 2019 levels. The framework aligns with Canada’s ambition to achieve net-zero emissions by 2050 while acknowledging the rising global demand for oil and gas.

Despite its focus on cutting pollution, the framework does not impose restrictions on the production of oil and gas.

The proposed rules additionally include changes to current carbon pricing systems, allowing carbon offsets to contribute to emissions goals for oil and gas facilities. Canada intends to establish a national cap-and-trade system under the Canadian Environmental Protection Act of 1999, empowering regulators to distribute emissions allowances.

“Every sector of Canada’s economy must do its part to combat climate change and build a safe, prosperous, and healthy future for Canadians,” said Minister of Environment and Climate Change, Steven Guilbeault. “All sectors of our economy need to reduce their emissions, and that includes oil and gas companies.”

The global debate at COP28 centers around the future of fossil fuels, with several opinions on whether to restrict or phase out their development due to their substantial impact on climate change.

Canada’s recent initiatives, including this proposal, aim to practically reduce the influence of fossil fuels in the immediate future. The country previously released guidelines to eliminate fossil fuel subsidies, positioning itself as reportedly the first Paris Agreement signatory to do so.

Canada insists that discontinuing fossil fuel subsidies is pivotal in transitioning toward a net-zero future and aligning with its net-zero targets.

“The Government of Canada’s plan to cap and reduce emissions from Canada’s largest emitting sector is ambitious but practical,” said Guilbeault. “It considers the global demand for oil and gas—and the importance of the sector in Canada’s economy—and sets a limit that is strict, but achievable. Canadians have always risen to the challenge of building a brighter future, and this greenhouse gas pollution cap will help Canada compete and succeed in a world that is moving to a clean-energy future.”