Juno News - Justin Trudeau wants a ＂just transition＂ away from Canada's energy sector

00:00:00.000 Welcome to Canada's Most Irreverent Talk Show.

00:00:06.660 This is The Andrew Lawton Show, brought to you by True North.

00:00:12.800 Coming up, a look at Justin Trudeau's so-called just transition away from the oil and gas sector and the industry's response.

00:00:22.160 The Andrew Lawton Show starts right now.

00:00:25.700 Welcome to The Andrew Lawton Show here on True North.

00:00:31.860 It is great to have you tuned in.

00:00:33.620 We've talked a lot about some of the big picture challenges facing the oil and gas sector,

00:00:39.120 facing the energy industry more broadly,

00:00:41.360 and how many of these are not being led by markets, but are actually being led by governments.

00:00:47.000 Government directives in Canada, some global initiatives like the Great Reset

00:00:51.200 that are really trying to push a phase-out of the energy sector, of the hydrocarbon sector,

00:00:56.540 which has a huge effect specifically on Alberta, but nationally and internationally as well.

00:01:02.540 One of these initiatives has not gotten nearly the coverage it deserves.

00:01:07.060 It's quite significant.

00:01:08.100 It's called the Just Transition.

00:01:10.380 Well, justice sounds good.

00:01:11.800 There's nothing wrong with that, right?

00:01:13.580 Well, the Just Transition is extracted from the Paris Climate Agreements,

00:01:17.400 and it is ultimately a method for the government to try to push a transition away from the energy sector.

00:01:24.580 And they talk about this in terms that make it sound like a hunky-dory thing,

00:01:28.240 but the reality is they aren't talking about the things that would actually help them do this.

00:01:33.960 A lot of the initiatives and solutions that are being driven by the energy sector.

00:01:38.380 So we do things differently here on The Andrew Lawton Show.

00:01:41.220 I wanted to delve in this with a level of detail,

00:01:44.060 and I've got a great panel together.

00:01:45.900 Joining me is Danielle Smith, who's the president of the Alberta Enterprise Group,

00:01:50.920 Michael Binion, who's the founder of the Modern Miracle Network,

00:01:54.800 Apoor Sinha, who's the CEO of Carbon Upcycling,

00:01:58.360 and Kevin Crossard, who's the CEO and co-founder of Avatar Innovations.

00:02:02.960 We've got a lot of brainpower on the panel today, myself not included in that,

00:02:06.760 but thank you to all of you for joining.

00:02:08.700 It's great to have you here.

00:02:09.760 Thanks, Andrew.

00:02:11.480 Now, I want to start with you, Danielle,

00:02:13.040 because you are one of the few people in media in Canada

00:02:15.820 who's actually given some attention to the just transition.

00:02:18.660 A lot of people that I know listen to this show

00:02:20.900 who would consider themselves astute followers of the news

00:02:23.460 probably have not come across this.

00:02:25.680 Even in the course of preparing for this show,

00:02:28.240 I was not finding much out there.

00:02:30.960 Tell me what this is,

00:02:32.300 and more importantly, why has no one been talking about it?

00:02:35.120 Because it seems pretty significant.

00:02:36.780 I think it was probably by design.

00:02:39.560 It was launched in the middle of summer on July the 20th.

00:02:42.540 Then we launched right into a federal election campaign,

00:02:44.740 and they were supposed to end the consultation September 30th,

00:02:47.680 which, of course, was only a few days after the election.

00:02:50.560 They wanted to have consultation by invite only

00:02:54.260 and invited everybody else to put in their submissions.

00:02:57.020 And Michael will tell you a little bit more

00:02:58.300 about how the various industry groups

00:03:01.020 and the public responded by putting submissions in.

00:03:03.280 And I think that's the reason why it's been delayed.

00:03:05.600 But the just transition,

00:03:06.860 we have to be careful of the wording that is used here.

00:03:09.180 That's the wording that the extreme left uses

00:03:11.500 as a way of talking about phasing out fossil fuels completely.

00:03:15.880 And it's built on this faulty premise

00:03:17.840 that I've been listening to for probably a decade,

00:03:20.360 that the entire world energy system

00:03:22.800 should convert to wind and solar.

00:03:25.320 We shouldn't have natural gas heating.

00:03:27.400 We shouldn't have combustion engine vehicles.

00:03:29.680 We should simply use this intermittent power

00:03:31.660 and have battery backup

00:03:32.700 and somehow that's supposed to fuel

00:03:34.760 a modern industrial economy.

00:03:36.620 I think we've seen through movies like Planet of the Humans,

00:03:39.660 if even Michael Moore realizes

00:03:41.220 that that vision is absolutely unachievable

00:03:44.420 and that even if you look at solar panels,

00:03:47.440 which are crystalline silicon made in China

00:03:50.600 using not only Uyghur slave labor,

00:03:52.800 but also using coal-fired electricity,

00:03:55.860 solar panels are not going to be net zero

00:03:57.520 until the fossil fuel industry is net zero.

00:04:00.420 Wind farms that have cement and steel and fiberglass,

00:04:04.340 they are not going to be net zero

00:04:05.740 until all of those industries are net zero as well.

00:04:08.320 And so I think the fossil fuel industry has taken on the challenge

00:04:10.720 and they intend to be net zero before anyone else.

00:04:13.380 And I think that's the message that's not getting out

00:04:15.360 that does need to get out.

00:04:16.400 Yeah, I think you raise an important point there

00:04:19.360 because the federal government's goals

00:04:21.280 and the Paris Climate Agreement's goals

00:04:23.140 are to reduce emissions.

00:04:24.660 The idea of sending really a death warrant

00:04:28.580 to an industry to reduce emissions

00:04:30.700 misses what's supposed to be the stated purpose,

00:04:32.800 which is the actual emissions.

00:04:34.080 The government of Canada is committing to net zero.

00:04:36.500 The global community is calling for that same thing.

00:04:39.180 And there seems to be missing from this

00:04:41.140 and missing from the government's messaging on this,

00:04:43.360 the reality of looking at carbon capture

00:04:46.160 as one notable example,

00:04:47.540 something that's very industry-led

00:04:49.280 that's working towards that same outcome.

00:04:52.220 I know you've written about this, Michael,

00:04:53.740 and I know you've discussed this

00:04:54.900 with your colleagues in the hydrocarbon sector,

00:04:57.280 but what is it that the energy sector

00:04:59.820 is bringing to the table here?

00:05:01.420 And why is the government

00:05:02.560 not looking for these solutions?

00:05:05.260 I think one of the big fundamental mistakes

00:05:08.620 that's been made in the public discourse

00:05:10.400 is this idea that oil and gas has static technology,

00:05:14.940 that it's not changing.

00:05:16.100 And it's led to this comparison

00:05:17.760 of wind and solar alternatives

00:05:19.700 using 2050 technology

00:05:21.240 to oil and gas using 1999 technology.

00:05:23.760 And of course, that becomes a simple decision.

00:05:26.620 But the fact of the matter is

00:05:27.720 that while costs of wind, solar, and wind

00:05:29.520 has been falling rapidly,

00:05:31.040 so has the cost of reaching net zero for oil and gas.

00:05:34.700 And I published an article that I think you saw,

00:05:37.600 that I actually think that once the industry

00:05:40.620 puts its mind to it, and it has,

00:05:42.820 that the industry can win the race to net zero.

00:05:46.380 And so that means we don't have to be this choice

00:05:48.700 between two extreme choices of business as usual,

00:05:51.400 don't worry, the climate's not as bad as you think,

00:05:53.680 or just transition,

00:05:55.860 we have to leave it in the ground,

00:05:57.340 but everybody needs to lose their jobs

00:05:59.760 to save the climate.

00:06:01.020 Those are the two extreme choices.

00:06:02.540 There's a third option.

00:06:03.460 And that third option, I think,

00:06:05.500 is with new carbon technology,

00:06:06.940 which is advancing rapidly.

00:06:08.260 Some of the people after me here

00:06:10.580 are going to talk to that.

00:06:12.540 And what I like to call the three R's, 1.00

00:06:14.400 which we're all familiar with.

00:06:15.260 We can reduce emissions.

00:06:16.640 We can reuse and recycle those emissions

00:06:19.080 into products as a feedstock,

00:06:20.480 and we can return it under the ground.

00:06:22.440 And using those three R's that everybody understands, 0.98

00:06:24.720 we have this third option

00:06:25.760 of an energy transformation.

00:06:26.880 And then just to answer,

00:06:30.020 and that energy transformation,

00:06:31.560 I think then allows us to have that mid,

00:06:33.880 all of the above solution

00:06:36.260 between those two extremes.

00:06:37.820 And I just want to quickly address

00:06:38.820 what Danielle was talking about,

00:06:40.440 you know, in terms of the consultation

00:06:42.240 and the,

00:06:43.760 there was 20,000 submissions

00:06:45.740 saying we've got concerns

00:06:47.880 about the fact that you haven't looked

00:06:49.160 at this third option.

00:06:50.640 And, you know,

00:06:51.140 I know there's some people talking about,

00:06:52.240 oh, well,

00:06:52.400 that was just industry stuffing.

00:06:53.700 Less than 20% of it came from CAPS Energy Citizens.

00:06:57.260 More than 80% of those 20,000 submissions

00:06:59.940 came from groups at large.

00:07:02.200 So I think that the government is missing

00:07:04.620 that people would rather see this third option.

00:07:08.420 And then finally just say,

00:07:09.600 you know,

00:07:09.780 $10 billion announcement by Dow Chemical

00:07:11.480 in Alberta for zero emissions ethylene.

00:07:14.480 I mean,

00:07:14.680 there's some proof points

00:07:15.700 of what Forbes and BBC in the UK talked about.

00:07:19.480 This is a potentially trillion dollar

00:07:21.060 emerging market.

00:07:21.740 Yeah, let's talk to some of the players

00:07:24.380 who are in that market.

00:07:25.880 Apoor, I know that carbon gets a bad rap.

00:07:28.560 A lot of people are told it's the bad guy

00:07:31.240 and we're not supposed to be doing anything

00:07:32.740 that unleashes it into the atmosphere.

00:07:34.780 What's carbon upcycling?

00:07:38.100 Really, Andrew,

00:07:39.040 I think, you know,

00:07:40.180 when we use the word upcycling in our name,

00:07:42.520 there wasn't a huge amount of recognition

00:07:44.140 as to how that was different from recycling.

00:07:46.460 But really the idea here

00:07:47.480 is to give carbon a second life

00:07:49.320 that is actually more meaningful

00:07:51.060 and useful for society

00:07:52.280 than in the first go-around.

00:07:53.880 So upcycling a plastic bottle

00:07:55.320 would be to use that plastic

00:07:57.200 in sustainable packaging

00:07:58.540 or some other kind of form

00:08:00.260 where it adds more value

00:08:02.300 than it did in its first go-around.

00:08:04.120 I think with carbon,

00:08:05.300 I, you know,

00:08:06.040 agree with a lot of what's been said.

00:08:07.920 I think the challenge

00:08:09.600 and the opportunity right now

00:08:11.260 when it comes to carbon emissions

00:08:12.420 is finding some ways of upcycling it, right?

00:08:15.860 Like, so there are ways

00:08:16.660 where CO2 can actually be

00:08:18.020 more than a pollutant.

00:08:19.140 Like Buckminster Fuller

00:08:20.040 talked about how pollution is

00:08:21.280 basically a waste

00:08:22.320 that hasn't found a purpose yet.

00:08:23.880 And we think in some ways,

00:08:25.580 in an aspirational way,

00:08:26.700 we think that there is a segment

00:08:27.900 of carbon emissions today

00:08:29.240 that can be used

00:08:30.440 to make better materials,

00:08:32.020 whether it be in plastics

00:08:32.900 or construction materials

00:08:34.180 or even energy storage applications.

00:08:36.740 But I think the bigger point here is,

00:08:38.760 and I think some of the kind of nuances here

00:08:41.840 that they get lost

00:08:42.720 in the public dialogue

00:08:43.880 is that ultimately,

00:08:45.320 if you think about CO2,

00:08:46.940 it really is a sink

00:08:48.380 for every single human activity.

00:08:50.700 And not just our activity,

00:08:52.020 it's for agricultural activity,

00:08:53.500 like, you know,

00:08:54.040 all the way down to emissions

00:08:54.940 from cows and things like that.

00:08:56.180 So, you know,

00:08:57.620 there is no potential market

00:08:59.940 which is going to take

00:09:01.300 all of this CO2 and upcycle it.

00:09:02.880 And I think there needs

00:09:03.540 to be a recognition

00:09:04.180 that some of these,

00:09:05.640 you know,

00:09:06.100 if we're going to close

00:09:07.100 this loop entirely,

00:09:07.860 some of these methods

00:09:08.800 are only going to be

00:09:09.440 a piece of the solution

00:09:10.680 and that recycling 0.87

00:09:12.140 some of these emissions

00:09:13.000 is actually going to be

00:09:13.800 a major chunk

00:09:14.440 of how we solve this.

00:09:15.780 And I think within that scope,

00:09:17.400 there is a realization

00:09:18.680 that carbon recycling

00:09:20.320 is as much,

00:09:21.540 you know,

00:09:21.780 an important part

00:09:22.560 of the solution

00:09:23.040 as upcycling.

00:09:24.000 I think the energy sector

00:09:25.060 has a massive amount

00:09:26.080 of expertise and knowledge

00:09:27.160 that we can leverage

00:09:27.800 towards that.

00:09:28.740 I mean,

00:09:28.940 no one knows

00:09:29.480 how to build bigger

00:09:30.300 and scale faster

00:09:32.040 than the energy sector

00:09:32.920 has done since the 60s.

00:09:34.100 And I think,

00:09:34.960 you know,

00:09:35.200 to that end,

00:09:35.820 I think,

00:09:36.260 you know,

00:09:36.500 some of the efforts

00:09:37.140 like Kevin and his team

00:09:38.280 at Avatar,

00:09:39.240 I think are really important

00:09:40.420 because,

00:09:40.960 you know,

00:09:41.360 instead of getting

00:09:41.880 into this polarized debate,

00:09:43.120 I think the real question here

00:09:45.160 is can we get

00:09:45.900 to the same table

00:09:46.620 and say these are all

00:09:47.980 the different parts

00:09:48.580 of the solution

00:09:49.120 where,

00:09:49.620 you know,

00:09:50.260 companies like us

00:09:51.080 and initiatives

00:09:51.720 from oil science companies

00:09:53.200 and others

00:09:53.580 can all contribute

00:09:54.500 in a positive way.

00:09:55.380 Yeah,

00:09:56.660 I'm glad you gave

00:09:57.500 Kevin a plug here

00:09:58.500 because I was going

00:09:59.120 to go to Kevin

00:09:59.680 across sort of Avatar

00:10:00.800 next on this.

00:10:02.220 Kevin,

00:10:02.540 your firm

00:10:03.180 has not only found

00:10:04.660 ways to connect

00:10:05.700 different players

00:10:06.360 and innovate new ideas,

00:10:07.840 but you've also found

00:10:08.780 there's a significant

00:10:09.600 amount of capital

00:10:10.580 behind driving

00:10:11.820 some of these ideas.

00:10:12.700 Again,

00:10:13.100 not coming from carbon taxes,

00:10:14.440 not coming from government,

00:10:15.660 but coming from

00:10:16.660 the industry itself.

00:10:18.980 Yeah,

00:10:19.200 well,

00:10:19.400 thanks,

00:10:20.080 Porv,

00:10:20.340 and I would have given him

00:10:21.260 an equally good shout out

00:10:22.560 as well.

00:10:23.060 It's a pleasure

00:10:23.800 working with them

00:10:24.580 and being on a panel

00:10:25.380 with these great thinkers.

00:10:27.640 But yeah,

00:10:27.960 so Avatar was really

00:10:28.860 born around the idea

00:10:30.140 that we can't

00:10:33.020 electrify everything

00:10:34.040 and there are many sectors

00:10:35.560 that are nearly impossible

00:10:37.040 to decarbonize

00:10:38.060 and the most rational

00:10:39.580 solutions that exist

00:10:40.660 to decarbonize

00:10:41.500 the sectors

00:10:41.980 that are most difficult

00:10:43.120 to decarbonize,

00:10:44.100 whether it's concrete

00:10:45.260 like before I was talking

00:10:46.080 about or fertilizer

00:10:47.620 or heavy industry

00:10:48.820 or steel,

00:10:50.220 these solutions

00:10:50.860 already exist

00:10:51.660 and they exist

00:10:53.100 inside oil and gas,

00:10:54.660 whether that is

00:10:55.340 carbon capture

00:10:56.080 or hydrogen

00:10:57.220 or geothermal

00:10:58.660 or long duration storage.

00:11:01.020 These are things

00:11:01.700 the oil and gas sector

00:11:02.520 has been already doing.

00:11:04.520 So the world's decided

00:11:05.980 it wants to decarbonize.

00:11:07.580 Capital markets have decided

00:11:08.880 they want to decarbonize.

00:11:10.340 That's where the smart money

00:11:11.320 is going.

00:11:12.000 And so how do we unlock

00:11:13.400 those solutions

00:11:14.060 inside oil and gas

00:11:15.060 for commercialization,

00:11:16.300 scale and export?

00:11:17.600 And we've been,

00:11:18.400 you know,

00:11:18.640 really delighted

00:11:19.380 to have the work

00:11:21.020 that we have.

00:11:22.220 And yeah,

00:11:23.260 so, you know,

00:11:24.020 it's no secret

00:11:25.340 that capital markets

00:11:26.380 are, you know,

00:11:27.260 putting a lot of levers

00:11:28.460 on, you know,

00:11:29.880 the investment community

00:11:31.100 to be investing

00:11:31.880 in decarbonization initiatives.

00:11:33.640 As a result,

00:11:34.520 the cost of capital

00:11:35.340 inside oil and gas

00:11:36.340 has risen pretty dramatically.

00:11:39.240 Whereas in the clean tech sector,

00:11:41.220 the cost of capital,

00:11:42.680 the, you know,

00:11:43.100 cost it's going to take

00:11:43.920 to invest in a project

00:11:44.820 to get it done

00:11:45.360 is dramatically lower.

00:11:47.200 But if we have

00:11:47.880 all of these solutions

00:11:48.700 inside oil and gas

00:11:49.620 that can meaningfully

00:11:50.740 make impacts

00:11:51.380 on emissions change,

00:11:52.820 how do we create

00:11:53.740 what rational investment

00:11:55.000 policies are going

00:11:55.740 to be doing

00:11:56.240 and widen the funnel 0.82

00:11:57.920 and create a lot

00:11:58.760 of new ideas?

00:11:59.700 So, you know,

00:12:01.220 I would,

00:12:01.760 I would agree with this,

00:12:02.940 you know,

00:12:03.180 and the other piece

00:12:04.740 of the puzzle

00:12:05.240 is that this,

00:12:05.940 you know,

00:12:06.160 a complex issue

00:12:07.600 in the sense that,

00:12:08.560 you know,

00:12:08.960 I use the word

00:12:10.040 energy transition,

00:12:11.400 not because I mean

00:12:12.100 we're transitioning

00:12:12.660 off of oil and gas,

00:12:13.920 but because we have

00:12:15.440 a skeptical public

00:12:16.260 who doesn't trust us.

00:12:17.720 And if they can see industry

00:12:19.680 as a meaningful

00:12:20.520 and powerful partner

00:12:21.680 in the planet's

00:12:22.740 climate ambitions,

00:12:24.040 you're going to have

00:12:24.720 a much different conversation

00:12:25.840 than we're trying to,

00:12:27.340 we're trying to,

00:12:28.080 we're trying to fool you again

00:12:29.520 is how I think

00:12:31.420 energy transformation

00:12:32.220 sometimes comes off.

00:12:33.320 But I know there's,

00:12:34.300 there's,

00:12:34.620 there's good debates

00:12:35.380 on both sides.

00:12:36.780 But I was on a call

00:12:37.540 yesterday with Europe

00:12:38.340 and in Egypt,

00:12:40.380 they just built a gigawatt

00:12:42.200 solar power factory

00:12:43.760 and, you know,

00:12:44.600 huge success.

00:12:45.480 They thought they had,

00:12:46.240 you know,

00:12:46.540 built and unlocked

00:12:47.360 all of these financial

00:12:48.620 instruments.

00:12:49.580 This just transition,

00:12:50.720 according to the Paris Accord,

00:12:51.740 isn't just the sort of

00:12:53.240 worker retraining piece,

00:12:54.480 it's also the bringing power

00:12:55.700 to the developing world

00:12:56.680 that doesn't have access

00:12:57.460 to basic electricity.

00:12:59.160 So they thought

00:12:59.900 this solar panel factory

00:13:01.360 was going to be a huge success.

00:13:02.820 They can't replicate 0.75

00:13:03.900 the financing for it now

00:13:05.220 because 50% of the polysilicate

00:13:08.020 in the world

00:13:08.840 that builds solar panels

00:13:10.440 comes from the Xinjiang

00:13:11.900 province in China

00:13:13.320 where the Uyghurs 1.00

00:13:14.120 have forced labor.

00:13:15.660 So these levers

00:13:16.500 of investments

00:13:18.160 that should be driving,

00:13:20.040 who's against a solar factory

00:13:21.520 in Egypt?

00:13:22.140 Probably nobody.

00:13:24.160 That these are complex issues

00:13:25.900 that we have to be looking at

00:13:27.460 as a rational investment basis

00:13:29.560 to be able to drive

00:13:30.460 real investment

00:13:31.180 and real jobs

00:13:31.960 around the world.

00:13:32.820 And that's, you know,

00:13:34.200 I think the exciting opportunity

00:13:35.580 that energy transition

00:13:37.640 or transformation,

00:13:38.720 whatever you want

00:13:39.280 to call it, has.

00:13:41.020 I want to go back to you

00:13:42.220 on this for a moment, Michael,

00:13:43.480 because what we've just heard

00:13:44.660 from Kevin,

00:13:45.720 what we've heard

00:13:46.180 from Apoor,

00:13:46.700 these are great

00:13:47.780 industry success stories,

00:13:49.280 they're great

00:13:49.620 Canadian success stories,

00:13:51.100 but when you look

00:13:51.940 at the government's

00:13:53.060 guidance document,

00:13:54.340 just to go back

00:13:54.920 to the just transition

00:13:55.820 for a moment,

00:13:56.660 this guidance document

00:13:57.740 doesn't reference at all

00:13:59.340 carbon capture,

00:14:00.440 carbon utilization,

00:14:01.560 carbon storage.

00:14:02.240 So we're back to

00:14:03.780 why are these

00:14:05.060 very real solutions

00:14:06.420 not being given

00:14:07.480 any weight

00:14:08.560 in what is supposed

00:14:09.620 to be a national

00:14:10.740 and I would hope

00:14:11.500 an industry-inclusive

00:14:12.620 discussion?

00:14:14.520 Yeah, well,

00:14:14.920 it's interesting

00:14:15.480 that places,

00:14:17.120 the International Energy

00:14:18.280 Agency

00:14:18.720 is maybe no surprise

00:14:19.900 that they're talking

00:14:20.540 about carbon capture,

00:14:21.560 but so is the World Economic Forum,

00:14:23.700 which we know

00:14:24.100 has been a big proponent

00:14:25.060 of the Great Reset.

00:14:26.060 and even people

00:14:27.500 like the United Nations

00:14:28.480 and these organizations

00:14:30.080 are talking about

00:14:30.640 that we're not going

00:14:31.840 to meet our targets.

00:14:33.160 We have to include

00:14:34.500 a carbon capture

00:14:35.780 and the Dunsky report

00:14:36.740 just came out in Quebec,

00:14:37.760 which is close to my heart

00:14:39.680 and they've talked about

00:14:41.660 we need these carbon capture solutions.

00:14:44.380 So you're absolutely right.

00:14:45.660 It's interesting

00:14:46.480 that the just transition

00:14:48.240 from our federal government

00:14:49.420 just presumes

00:14:51.320 we're going to have

00:14:52.560 to pick between

00:14:53.180 business as usual

00:14:54.100 and a full

00:14:54.860 leave-it-in-the-ground approach.

00:14:57.280 And so why aren't they

00:14:59.800 like some of these

00:15:00.600 other international agencies

00:15:01.960 saying,

00:15:02.740 well, maybe we need

00:15:03.280 a third option.

00:15:05.660 And I would say

00:15:06.540 that Alberta

00:15:08.040 and Western Canada

00:15:09.420 and our industry

00:15:10.400 is more and more

00:15:11.660 all in on this idea

00:15:12.820 of let's look

00:15:13.460 at this third option.

00:15:14.180 And you're right,

00:15:14.760 wasn't considered

00:15:15.340 in the election,

00:15:16.360 isn't being considered

00:15:17.200 in this just transition

00:15:18.120 to the consultation.

00:15:20.020 You pointed out

00:15:21.100 just to lay some

00:15:22.000 of the political groundwork

00:15:23.080 here, Danielle,

00:15:23.860 and in a column

00:15:24.480 you wrote about this,

00:15:25.460 a letter signed

00:15:26.600 by a bunch of

00:15:27.220 the usual suspects

00:15:28.160 who are very much

00:15:29.400 against the fossil fuel sector

00:15:30.980 and don't want

00:15:31.860 the industry involved.

00:15:33.280 And they don't think

00:15:34.320 that carbon capture

00:15:35.880 and carbon storage

00:15:36.960 have a role in this at all.

00:15:38.560 And I want to quote

00:15:39.220 from this letter

00:15:39.880 they sent to Canadian MPs

00:15:41.580 because carbon capture

00:15:42.940 is, quote,

00:15:43.560 at odds with a just

00:15:44.940 energy transition

00:15:45.860 and the principles

00:15:47.240 of environmental justice.

00:15:49.420 Explain this.

00:15:50.820 What does that mean?

00:15:52.060 Well, if I could,

00:15:52.920 I would.

00:15:53.480 I think what is interesting

00:15:54.520 is that letter came out

00:15:55.800 the day before

00:15:57.260 they launched

00:15:58.100 the just transition

00:15:59.220 consultation.

00:16:00.760 And that doesn't happen

00:16:01.860 by accident.

00:16:02.960 There was a full court press,

00:16:04.640 I think,

00:16:05.220 to try to get

00:16:06.060 the environmental community

00:16:07.560 that has a fairly extreme view

00:16:09.060 of the only energy sources

00:16:10.380 we should be allowed

00:16:11.140 to use to participate

00:16:12.260 in this consultation

00:16:13.620 to get the foregone conclusion.

00:16:15.600 That's what I think

00:16:16.160 was going on.

00:16:17.300 But I think it's been derailed

00:16:18.980 for a lot of the reasons

00:16:20.040 that Michael has just suggested.

00:16:21.880 There's some pragmatism

00:16:24.100 that is setting in here.

00:16:25.180 I've talked to many members now,

00:16:27.020 surprisingly,

00:16:28.320 from the environmental community

00:16:30.600 who in the past

00:16:31.620 you might have thought

00:16:32.380 would be hostile

00:16:33.100 to the energy sector,

00:16:34.920 the traditional hydrocarbon sector,

00:16:36.460 who realized

00:16:37.240 that the only way

00:16:38.420 to meet the international targets

00:16:40.300 is to use carbon capture

00:16:42.120 utilization and storage,

00:16:43.600 is to look at hydrogen.

00:16:45.560 The most efficient way

00:16:46.500 of creating hydrogen

00:16:47.760 is through natural gas,

00:16:49.780 looking at LNG exports

00:16:51.720 to reduce the reliance

00:16:52.960 on coal-fired electricity.

00:16:54.780 So there is, I think,

00:16:56.580 a growing pragmatism

00:16:57.820 and a split

00:16:58.460 in the environmental movement

00:16:59.620 from those who really want

00:17:01.660 to solve this problem

00:17:03.080 versus those who just want

00:17:04.780 to kill the fossil fuel industry.

00:17:06.960 And I don't know

00:17:07.300 if I know all the reasons why.

00:17:09.000 Maybe it's because

00:17:09.720 the energy sector

00:17:10.500 has traditionally been

00:17:12.360 extremely well-funded.

00:17:15.020 Maybe it has been a bit,

00:17:16.620 as Kevin put it,

00:17:17.740 they kind of dragged their feet

00:17:19.180 and not embrace the challenge

00:17:21.740 in a fulsome way.

00:17:23.360 But something happened

00:17:24.240 that was quite,

00:17:24.980 I think, quite dramatic

00:17:26.300 is that when Justin Trudeau

00:17:28.100 set a target of $170

00:17:30.380 for a price on carbon,

00:17:32.540 I think that was a wake-up moment

00:17:34.400 for the industry.

00:17:35.280 And they sat back and thought,

00:17:36.620 hmm, why would I just sit here passively

00:17:38.660 and spend $170 a tonne in tax?

00:17:42.060 Why don't I find a creative way

00:17:43.400 to turn this into a feedstock?

00:17:45.480 And once you've made

00:17:46.200 that mental transformation

00:17:47.600 that CO2 is not a pollutant,

00:17:51.660 but it's a feedstock

00:17:52.540 for useful products,

00:17:53.580 or it's something

00:17:54.340 you can monetize

00:17:55.400 if you find a way

00:17:56.100 to bury it underground,

00:17:57.380 I think that that has unlocked

00:17:58.860 a whole amount

00:18:00.040 of entrepreneurial investment

00:18:01.460 and creative thinking

00:18:02.500 that the federal government

00:18:04.020 and the environmental movement

00:18:05.120 quite frankly

00:18:05.900 hasn't caught up with yet.

00:18:07.660 Well, let me ask you then,

00:18:08.920 Apoorv,

00:18:09.140 what has been,

00:18:10.040 in your experience,

00:18:10.820 the driving force

00:18:11.800 behind a lot of the capital

00:18:13.640 and a lot of the corporate interest

00:18:15.340 in this?

00:18:15.680 Is it coming from

00:18:16.500 a genuine desire

00:18:17.820 to sort of reduce the impact,

00:18:20.340 or is it coming from,

00:18:21.720 as Danielle's comment 1.00

00:18:23.340 kind of suggests,

00:18:24.380 oh my goodness,

00:18:24.940 we don't want to be

00:18:25.620 on the hook for this

00:18:26.280 with how carbon taxes

00:18:27.220 are going up?

00:18:28.880 Yeah, I mean,

00:18:29.660 there was a few different things

00:18:30.940 said there

00:18:31.340 that I had some visceral

00:18:33.620 responses to, I guess,

00:18:34.600 and I think what Danielle

00:18:36.320 said there

00:18:36.960 is exactly right.

00:18:38.660 I couldn't agree more

00:18:39.480 about the power of the signal

00:18:41.360 with that announcement

00:18:42.780 about the tax

00:18:43.800 and, you know, again,

00:18:44.980 I tend to be realistic

00:18:46.700 about these things

00:18:47.380 and I don't know

00:18:48.300 how feasible it is

00:18:49.180 that Canada will have

00:18:49.920 a $170 a ton carbon tax

00:18:52.180 and, you know,

00:18:52.960 while Singapore and the UK

00:18:54.400 and others

00:18:55.020 are going to get away

00:18:55.600 with $5 to $10 a ton.

00:18:57.920 And maybe the UK

00:18:58.860 wasn't a great example

00:18:59.640 because they're actually

00:19:00.180 trying to be progressive,

00:19:01.160 but there are definitely

00:19:02.400 segments in Europe

00:19:03.220 which are, you know,

00:19:04.420 further behind

00:19:04.960 some of the more progressive

00:19:05.920 kind of narrative

00:19:07.020 that we see on the news.

00:19:08.000 And I think what's important here

00:19:09.480 is to realize that,

00:19:10.980 you know,

00:19:11.880 everyone's kind of looking

00:19:12.660 for different pieces here

00:19:14.200 in terms of validating

00:19:15.460 what they're doing, right?

00:19:16.240 Like the energy sector,

00:19:17.140 I think, again,

00:19:18.340 I agree with Danielle.

00:19:19.160 I think they've been slow

00:19:20.060 on the uptake

00:19:20.580 maybe at the start

00:19:21.260 and maybe they're still paying

00:19:22.340 kind of a disproportionate price

00:19:23.920 for that,

00:19:24.640 but I think they're absolutely

00:19:25.640 a part of the short-term

00:19:26.940 solution here.

00:19:27.920 And I think the government,

00:19:29.960 frankly,

00:19:30.740 needs to realize

00:19:31.580 that major announcements

00:19:33.160 and major kind of funding

00:19:35.320 announcements in particular

00:19:36.300 doesn't necessarily

00:19:37.380 solve the problem.

00:19:38.220 I mean,

00:19:38.360 there's a lot of really hard work

00:19:40.320 that has to be done

00:19:41.020 by very competent people

00:19:42.280 and by very competent groups

00:19:43.640 of people

00:19:44.440 that have to come together

00:19:45.340 from very different backgrounds.

00:19:47.340 And I think there is

00:19:48.080 a notion right now on the,

00:19:49.920 you know,

00:19:50.140 and I don't want to get

00:19:50.780 political at all

00:19:51.420 because that's not my domain,

00:19:52.640 but there is a progressive arm

00:19:54.700 that thinks that

00:19:55.300 all that we need is money.

00:19:57.140 And I think that is absolutely

00:19:58.220 the wrong way to look at this

00:19:59.360 because there are many,

00:20:01.220 many ways

00:20:01.840 to spend money badly.

00:20:03.300 And I think what is happening

00:20:04.260 right now

00:20:04.780 is there are ways

00:20:06.360 where people

00:20:07.320 are chasing announcements.

00:20:08.580 I think even

00:20:09.100 with private capital,

00:20:10.480 like I can speak about this

00:20:11.720 from a carbon tech perspective.

00:20:13.300 I think there are many companies

00:20:14.520 that have talked about

00:20:16.360 not generating revenue

00:20:17.420 for four, five, six years,

00:20:18.800 and they're getting

00:20:20.660 very significant valuations

00:20:22.360 that have actually got

00:20:23.740 some people in the industry

00:20:24.720 talking about how this might be

00:20:26.200 the second clean tech bust

00:20:27.620 in a couple of years.

00:20:28.800 And frankly,

00:20:29.720 regardless of whether you agree

00:20:31.000 with how important,

00:20:32.100 you know,

00:20:32.320 that priority is or not,

00:20:34.040 I think everyone will agree

00:20:35.520 that no one is going to be better off

00:20:37.660 if this crashes in two years

00:20:38.860 because there was a whole

00:20:39.800 bunch of false dawns.

00:20:41.380 And so, you know,

00:20:42.440 I think the last thing

00:20:43.440 I'll say on this

00:20:44.180 from my perspective

00:20:45.620 as an entrepreneur

00:20:46.180 is, you know,

00:20:47.160 look at what the hard facts are

00:20:48.540 and I think the government

00:20:49.780 needs to stop sitting on the fence

00:20:51.760 and actually pick winners.

00:20:52.800 I know there's this big Canadian

00:20:54.560 kind of, I guess,

00:20:56.940 reticence to pick winners, right?

00:20:58.740 Like, and I think that needs to stop

00:21:00.100 because there are only

00:21:00.980 a handful of companies, frankly,

00:21:02.940 that are going to make

00:21:03.640 a meaningful impact in this.

00:21:04.960 Like, imagine if instead of Ford,

00:21:06.800 you had 10 other companies

00:21:07.840 that the U.S. government

00:21:08.600 and all the U.S. industry

00:21:10.460 was trying to support at that time.

00:21:12.100 I mean, you know,

00:21:12.980 would all 10 have succeeded

00:21:14.120 the way Ford did?

00:21:14.940 I don't think it's possible, right?

00:21:16.800 And so I'll just finish

00:21:18.060 by saying that

00:21:18.740 there are certain metrics

00:21:20.800 about, you know,

00:21:21.540 commercial uptake,

00:21:23.020 you know,

00:21:23.340 the amount of validation

00:21:25.100 you've been able to achieve,

00:21:26.120 the kind of traction

00:21:26.820 you're getting with real customers.

00:21:28.860 And these are things

00:21:29.760 that frankly right now,

00:21:31.060 whether it be private capital

00:21:32.120 or government capital,

00:21:33.420 I don't think that,

00:21:34.220 you know,

00:21:34.380 there's a kind of a skewed lens

00:21:35.920 in which this is being looked at.

00:21:37.120 Like they're saying,

00:21:37.920 oh, this is a no-brainer.

00:21:38.780 This is going to work in three years.

00:21:40.360 But the fact is that,

00:21:41.340 you know,

00:21:41.680 out of this basket of 20 or 30 things

00:21:43.600 that you might be looking at,

00:21:44.660 there's only two or three

00:21:45.460 that are really going to work.

00:21:46.460 And there are sometimes

00:21:48.380 very obvious signs

00:21:49.240 as to what those are.

00:21:50.240 And I think I would just urge

00:21:51.720 not just government

00:21:52.460 and policymakers,

00:21:53.300 but even the private capital folks

00:21:54.600 to pay more attention to that.

00:21:56.080 Because at this point,

00:21:57.620 you know,

00:21:57.840 just a sense of urgency

00:21:58.920 is making them kind of spray,

00:22:01.260 you know,

00:22:01.700 spaghetti on the wall.

00:22:02.520 And that's not necessarily

00:22:03.860 the best approach.

00:22:05.360 Now, I think that's a wise warning.

00:22:07.640 And if I shift this for a moment

00:22:09.520 to government funding,

00:22:11.220 which I think is a useful proxy

00:22:12.980 for government priorities

00:22:14.080 in some cases,

00:22:15.140 I would ask you, Kevin,

00:22:16.340 I mean,

00:22:16.560 where is the government's interest in this?

00:22:19.780 Because I know for years now,

00:22:21.460 especially I'm in Ontario,

00:22:22.460 we've heard about the importance

00:22:24.040 of spending billions

00:22:24.960 and billions of dollars

00:22:25.960 on renewable energy

00:22:27.060 and, you know,

00:22:27.940 solar power,

00:22:28.880 wind power,

00:22:29.480 all of these things.

00:22:30.220 And there's been so much

00:22:31.160 of an emphasis on that

00:22:32.300 but that doesn't really solve

00:22:34.620 the underlying existence

00:22:36.660 of the fossil fuel sector,

00:22:38.100 which they do want to,

00:22:39.400 as we know,

00:22:39.840 phase out from.

00:22:40.960 Why have they not been trying

00:22:42.660 to assist the industry

00:22:44.080 in making this sector better?

00:22:45.840 I know the Canadian Association

00:22:47.500 of Petroleum Producers,

00:22:48.640 for example,

00:22:49.220 came out and asked for the government

00:22:51.200 to come up with basically

00:22:52.540 a tax credit system

00:22:53.740 similar to what the steel industry

00:22:55.120 has been given.

00:22:56.040 But at this point,

00:22:56.760 there's not really been

00:22:57.480 any uptake on that.

00:22:59.620 Yeah, there's a lot there.

00:23:02.300 I guess to unpack.

00:23:03.500 But, you know,

00:23:03.940 what I will say first

00:23:05.020 and foremost is that

00:23:05.960 I agree with Apoor 100%.

00:23:07.540 There is a lot of bad ways

00:23:09.160 for the government

00:23:09.640 to spend money.

00:23:10.960 And if government

00:23:13.000 is going to be putting

00:23:13.920 public money

00:23:14.680 into energy transition,

00:23:17.140 transformation,

00:23:17.920 whatever have you,

00:23:18.860 it singularly has to be

00:23:20.420 serving something

00:23:21.440 the market isn't

00:23:22.180 currently delivering.

00:23:23.880 And that's not a way

00:23:25.160 a lot of the funding

00:23:26.140 is being doled out.

00:23:29.080 And I think to Apoor's point,

00:23:31.000 I don't know if

00:23:31.620 the government

00:23:32.740 should be picking winners.

00:23:34.120 I think that the government

00:23:35.580 needs to drop its mentality

00:23:36.940 of anybody that's actually

00:23:38.540 going to make money

00:23:39.180 will dole money out too.

00:23:42.440 So Avatar has put 270

00:23:44.380 oil and gas professionals

00:23:46.160 from 67 oil and gas companies

00:23:49.440 in eight provinces

00:23:50.760 generating 45 industry-driven

00:23:53.180 energy transition solutions,

00:23:55.160 generated seven companies.

00:23:56.380 we've never received

00:23:57.660 a cent of money

00:23:58.680 from public funding.

00:24:00.060 And we're proud of that.

00:24:00.840 We're very proud of that

00:24:01.680 because you know

00:24:02.640 what the industry is saying.

00:24:03.560 They're saying,

00:24:03.980 we think this is important,

00:24:05.540 so let's go.

00:24:06.400 So we're going to put our money

00:24:07.160 where our mouth is.

00:24:08.480 However, there is a whole

00:24:09.600 bunch of money

00:24:10.080 that's going into

00:24:10.900 a lot of not-for-profits

00:24:12.140 that are speaking

00:24:13.920 on these just transition issues.

00:24:16.440 And what results

00:24:18.140 are they delivering?

00:24:19.460 And have they created

00:24:20.160 these albatrosses

00:24:21.280 that nobody knows

00:24:22.560 what to do with?

00:24:23.140 And I think that there

00:24:23.900 is a lot of that.

00:24:26.080 The money is coming

00:24:27.120 to the table

00:24:27.860 in ridiculous ways.

00:24:30.660 Even the announcement

00:24:31.320 today by TransCanada

00:24:32.420 and Nicola Hydrogen.

00:24:34.560 You know,

00:24:34.760 there is huge capital

00:24:37.320 that's kind of coming

00:24:37.940 to the table here.

00:24:39.140 So the role government

00:24:40.040 needs to be thinking about

00:24:41.240 is how can it focus

00:24:43.140 on the areas of the market

00:24:44.660 that are currently

00:24:45.240 being underserved?

00:24:46.380 And I have some ideas on that.

00:24:48.100 I think it's seed stage

00:24:49.240 risk capital.

00:24:50.580 There's all of these

00:24:51.520 government grants

00:24:52.360 at the $50,000,

00:24:53.600 $100,000 levels

00:24:54.600 for new technologies.

00:24:56.100 And then there's

00:24:56.500 all this private equity

00:24:57.440 at $10 million investments.

00:24:59.400 There's not a lot

00:25:00.080 in the middle

00:25:00.460 and that's the gap

00:25:01.000 avatar is filling right now.

00:25:02.780 But we, you know,

00:25:04.120 what is the role

00:25:04.900 the government

00:25:05.260 could be playing

00:25:06.220 that you singularly

00:25:07.640 drive investments

00:25:08.440 and returns?

00:25:09.780 You know,

00:25:10.380 nobody knows,

00:25:12.000 most people agree

00:25:13.200 that we're getting to,

00:25:14.040 we have to get rid

00:25:14.600 of carbon emissions.

00:25:16.060 Now the question

00:25:16.860 needs to be

00:25:17.560 what's the cheapest

00:25:18.440 and most effective way

00:25:20.160 to get there?

00:25:21.020 And that's the role

00:25:21.800 the conservatives

00:25:22.400 need to be playing

00:25:23.140 in this

00:25:23.440 and where I think

00:25:24.020 good conservative policy is.

00:25:26.040 And that's going to be

00:25:26.560 a market-driven approach.

00:25:28.080 So that's, I think,

00:25:29.340 that's, I think,

00:25:29.920 where the big opportunity

00:25:30.780 is and the big excitement

00:25:31.800 is in this area.

00:25:33.420 Is this isn't about

00:25:34.440 retraining $150,000

00:25:36.460 a year petroleum engineers

00:25:37.980 to become baristas

00:25:39.320 at Starbucks.

00:25:40.420 This is about realizing

00:25:42.400 that it's really easy

00:25:43.480 to probably take

00:25:44.140 a petroleum reservoir engineer

00:25:45.420 and turn them

00:25:45.960 into a carbon sequestration

00:25:47.280 reservoir engineer

00:25:48.220 because there's

00:25:49.320 an opportunity there

00:25:50.100 and there's money there.

00:25:51.000 That's the conversation

00:25:51.780 we should be having.

00:25:53.260 Not, how do we win at this?

00:25:55.660 Not, how do we make it

00:25:57.020 as least painful

00:25:57.760 as possible?

00:25:59.000 Which is the conversation

00:25:59.920 they're trying to have right now.

00:26:01.360 So let's take a step back here

00:26:03.020 and accept for a moment

00:26:04.480 the government's goal

00:26:06.140 of reducing carbon emissions

00:26:07.720 by 40 to 45%.

00:26:09.600 So let's take the politics

00:26:10.820 out of this

00:26:11.380 and where I think

00:26:12.240 a lot of us

00:26:12.680 could probably have

00:26:13.280 a very vigorous debate

00:26:14.900 about whether that's a reasonable

00:26:16.040 or realistic goal.

00:26:17.040 That's the government's goal.

00:26:18.520 The best way to get there,

00:26:20.660 can it be done

00:26:21.780 through all of these mechanisms

00:26:23.240 that we've just been talking about?

00:26:24.500 I don't know who wants

00:26:25.000 to jump in on this,

00:26:25.880 but can these industry-led solutions

00:26:28.000 meet that?

00:26:28.800 And if not,

00:26:29.580 how much of that

00:26:30.600 could they meet?

00:26:31.640 And let me jump in.

00:26:32.640 I know because I have

00:26:33.860 one example

00:26:34.960 that I can give you

00:26:35.760 just to show you

00:26:36.540 the power

00:26:37.100 and the incredible capacity

00:26:38.760 we have for poor space.

00:26:40.940 So I know of a single company

00:26:42.400 at a single site

00:26:43.700 that used to have

00:26:44.440 deep gas wells.

00:26:45.460 They've done,

00:26:46.080 and they have a compressor

00:26:46.780 at the site.

00:26:47.560 So they've done their analysis.

00:26:49.220 They believe that they can bury

00:26:50.460 80 megatons of CO2.

00:26:55.080 Now, what is that?

00:26:56.360 Well, we produce

00:26:57.200 270 megatons a year

00:26:59.400 of CO2 in Alberta

00:27:00.320 and 740 megatons

00:27:01.880 in the entire country

00:27:03.140 in a year.

00:27:03.680 If that is one single site

00:27:05.940 from one single company.

00:27:07.900 And one third

00:27:08.400 of Alberta's output.

00:27:09.760 It's extraordinary.

00:27:12.040 So to me,

00:27:12.860 the issue of carbon capture

00:27:14.640 utilization and storage,

00:27:15.640 storage is immensely powerful.

00:27:17.780 To the point,

00:27:18.940 I think,

00:27:19.240 that Approve was making

00:27:20.860 is that there will only be a,

00:27:22.900 I don't know how

00:27:23.880 they try to rationalize

00:27:25.880 which projects

00:27:27.000 are most likely

00:27:27.780 to be successful

00:27:28.700 from the utilization

00:27:29.560 point of view.

00:27:30.600 But I can say

00:27:31.240 from the storage point of view,

00:27:32.520 all government needs to do

00:27:33.380 is get out of the way.

00:27:34.260 We don't even have a policy yet

00:27:35.620 for how you get permission

00:27:37.380 to bury CO2 underground.

00:27:38.920 We don't have a royalty structure.

00:27:41.200 There should be a price

00:27:42.160 that goes on the CO2

00:27:43.420 once it goes back

00:27:44.360 into the ground as well.

00:27:45.380 They haven't developed that.

00:27:46.460 So I think what I'm observing

00:27:47.800 is government is actually

00:27:49.620 lagging behind industry on this.

00:27:52.240 And we need to create

00:27:53.120 some framework

00:27:53.800 so that those companies

00:27:55.120 that are able to go ahead

00:27:56.360 without government support

00:27:57.560 have a clear path to do it.

00:27:59.340 Maybe you then have

00:28:00.040 a broader conversation

00:28:01.000 with the big five

00:28:01.900 that wants some significant

00:28:03.780 tax breaks

00:28:04.680 for their carbon trunk line

00:28:06.940 and sequestration project

00:28:08.320 they're going to do

00:28:09.020 in Cold Lake.

00:28:10.020 And then maybe there's

00:28:10.700 also additional conversations

00:28:11.920 that you have

00:28:12.440 about what the most

00:28:13.200 optimistic options are

00:28:15.680 for transforming

00:28:16.600 those into products.

00:28:17.520 But I would say

00:28:18.240 you let the market work first.

00:28:20.040 Let those innovators

00:28:20.960 keep on going,

00:28:22.160 stay out of their way

00:28:22.940 and try not to stop them

00:28:24.280 with government policy.

00:28:26.180 I'd like to just add

00:28:27.140 to Danielle's point

00:28:27.960 with a shameless plug 0.65

00:28:28.820 for my own company,

00:28:29.740 if I could, Andrew,

00:28:30.480 which is that

00:28:31.000 we've got a gas discovery

00:28:32.520 in Quebec,

00:28:33.300 which we...

00:28:33.700 This is Questair,

00:28:34.900 not Modern Miracle.

00:28:36.260 Exactly, but it's where

00:28:37.700 I get paid to work.

00:28:39.260 And we've got a project there

00:28:41.760 where we've...

00:28:43.500 And this is really

00:28:44.480 where I came to realize

00:28:45.600 that people were looking

00:28:46.380 at our technology

00:28:47.100 as being older than it is.

00:28:48.620 But we can produce

00:28:49.580 the actual gas there

00:28:50.540 in the conventional way

00:28:51.660 and it can be used

00:28:52.700 in an industrial park

00:28:53.480 or whatever

00:28:53.900 and then be emitted

00:28:55.380 into the air.

00:28:55.960 But we realized,

00:28:56.560 well, we could put

00:28:56.980 two pipelines in the ground

00:28:58.060 for not much more money

00:28:58.940 than one

00:28:59.380 because you already

00:28:59.940 got the ditch there.

00:29:01.000 Bring a CO2 line back.

00:29:02.260 We've got carbon

00:29:02.940 storage reservoirs

00:29:03.920 right underneath

00:29:04.680 where the gas is.

00:29:06.240 So we could make

00:29:06.700 a literal circle

00:29:07.480 where we say,

00:29:08.040 well, we'll send you the gas

00:29:08.960 and then just like

00:29:10.000 so many other products,

00:29:11.280 I'll take, you know,

00:29:11.900 like I'll sell you

00:29:12.780 a can of Coke,

00:29:13.340 I'll take the can back

00:29:14.160 when you're done, right?

00:29:15.000 But we'll sell you

00:29:16.100 the natural gas,

00:29:16.920 we'll take the CO2 back.

00:29:18.440 And in addition to that,

00:29:19.700 which is already

00:29:20.380 zero emissions production

00:29:21.660 and zero emissions consumption,

00:29:23.820 100% zero emissions

00:29:25.220 for natural gas.

00:29:26.460 I don't know

00:29:27.100 that wind and solar

00:29:27.740 can match that,

00:29:28.440 to be honest.

00:29:29.260 On top of that,

00:29:30.140 what we really would like to do

00:29:31.260 and we talk, you know,

00:29:32.020 how we met people

00:29:33.040 like APRA visit,

00:29:34.580 we'd really like

00:29:35.420 to also look at

00:29:36.160 the opportunities

00:29:36.700 to take some

00:29:37.140 of that captured carbon

00:29:38.100 and turn it

00:29:38.600 into useful things

00:29:39.660 because,

00:29:41.580 as Daniel pointed out,

00:29:43.400 what opened my eyes

00:29:44.500 was when somebody

00:29:45.240 in Quebec told me,

00:29:46.080 I'll pay you $140

00:29:47.560 a tonne

00:29:48.400 for a carbon credit.

00:29:49.640 I went,

00:29:49.900 yo, what?

00:29:51.520 That's as much money

00:29:52.460 as I get

00:29:52.820 for the natural gas.

00:29:53.760 So then that opened my eyes

00:29:56.460 to, well,

00:29:56.760 then why don't we

00:29:57.560 take that $140

00:29:58.480 and turn it

00:29:59.540 into a cement additive

00:30:00.540 with the group

00:30:01.580 like with carbon upcycling?

00:30:02.980 Why wouldn't we do that?

00:30:04.040 We can make money

00:30:05.020 doing that, right?

00:30:06.040 So that's what

00:30:06.740 really opened my eyes.

00:30:07.780 So I was saying

00:30:08.600 to my daughter,

00:30:09.240 you know,

00:30:09.360 this organic chemistry

00:30:10.260 has been understood

00:30:10.900 for a long time.

00:30:11.900 We probably could have done

00:30:12.720 this 20 years ago.

00:30:13.600 She says,

00:30:13.840 well, then why haven't we been?

00:30:15.320 I said,

00:30:15.660 well, there was never,

00:30:17.040 it's just like the can of Coke.

00:30:18.400 We never used to recycle

00:30:19.300 those when I was a kid

00:30:20.060 either until they put

00:30:20.680 a deposit on it, right?

00:30:21.540 She says,

00:30:21.980 oh, so I guess that means

00:30:22.920 carbon taxes are good,

00:30:23.900 right, Dad?

00:30:24.260 I said,

00:30:24.480 well, let's end

00:30:24.960 the conversation here then.

00:30:27.900 And she's not coming

00:30:28.720 to Thanksgiving anymore, right?

00:30:30.180 No, I'm still going

00:30:31.240 to invite her to Thanksgiving.

00:30:32.340 She didn't need

00:30:33.380 to be so right on that point.

00:30:35.280 I know you don't want

00:30:36.420 to get into politics before,

00:30:38.200 so I hope you'll indulge

00:30:39.260 the question nonetheless.

00:30:40.700 If it is this simple

00:30:42.400 and it is something

00:30:43.540 that the industry

00:30:44.220 could be doing without ease,

00:30:45.860 why has there not been

00:30:48.080 a push to the government

00:30:48.920 or perhaps there have been

00:30:49.960 of just, you know,

00:30:50.580 just back off for a year

00:30:51.640 and see what we can do?

00:30:52.900 I mean, the numbers

00:30:53.520 that Danielle gave,

00:30:54.440 I'm assuming,

00:30:55.320 are not unfamiliar to you

00:30:57.060 about how much

00:30:57.940 the industry could do

00:30:58.780 if it were just

00:30:59.580 to take this over, basically.

00:31:02.220 Well, I think it boils down

00:31:03.880 to just simple

00:31:05.200 kind of incentives, right?

00:31:06.660 And I think, you know,

00:31:07.660 Michael hit the nail on the head.

00:31:09.280 I think ultimately

00:31:10.320 there is a cost

00:31:12.160 to changing anything.

00:31:13.800 And I think that's

00:31:14.380 one of the things

00:31:14.940 where, you know,

00:31:15.580 one of, I guess,

00:31:16.660 the realizations

00:31:17.200 that we've had

00:31:17.880 and I've had as a CEO

00:31:18.840 of a startup

00:31:19.480 is, you know,

00:31:20.460 when we go out

00:31:21.200 and pitch for a government grant,

00:31:23.160 the audience

00:31:23.720 that we're dealing with

00:31:24.400 is very different

00:31:25.080 from when we talk

00:31:26.580 to the CEO

00:31:27.160 of a large construction company.

00:31:29.160 And then when we go out

00:31:29.960 to the quality control people

00:31:31.080 and the guys

00:31:31.500 that are actually running

00:31:32.220 the trucks

00:31:32.580 and managing the day-to-day

00:31:33.600 at that company,

00:31:34.740 again, very different audience, right?

00:31:36.940 And then we talk

00:31:37.780 to the EPC companies,

00:31:38.740 then we talk to the architects

00:31:39.640 and the city procurement people.

00:31:41.000 And you'll see, you know,

00:31:42.240 like there are a couple

00:31:42.960 of cities in Alberta

00:31:43.720 that have declared

00:31:44.300 climate emergencies

00:31:45.100 and you go out

00:31:46.720 to their procurement people

00:31:47.480 and say, hey,

00:31:48.040 like this is a sustainable product.

00:31:49.800 It's pretty much

00:31:50.240 the same price

00:31:50.780 as what you're paying,

00:31:51.420 maybe 2% more

00:31:52.440 or something like that.

00:31:53.440 Are you interested?

00:31:54.200 And they say, well,

00:31:54.900 you know,

00:31:55.120 we don't really know

00:31:55.880 how to do this

00:31:56.480 and like this is new stuff

00:31:58.420 and we've got all the data,

00:31:59.460 but we've never really

00:32:00.360 tried anything.

00:32:00.940 Like in my 25 years

00:32:02.840 of work in this space,

00:32:04.220 like they have no precedence

00:32:05.920 to fall back to.

00:32:07.040 And I think what ends up happening,

00:32:08.240 I think, Andrew,

00:32:08.760 is there is such

00:32:10.020 a massive disconnect.

00:32:11.200 Like we all work

00:32:11.880 in our circles

00:32:12.520 and no one's actually

00:32:13.500 going out and meeting

00:32:14.180 these people

00:32:14.620 that aren't seeing

00:32:15.300 the other kind of rough edges

00:32:16.840 of how change happens.

00:32:18.380 So I think my answer

00:32:20.100 to why this is slower,

00:32:21.440 I think is, you know,

00:32:22.900 can we put a short-term

00:32:24.760 kind of credible incentive

00:32:26.540 that people can rely on

00:32:27.920 and let the market

00:32:29.600 do its work, right?

00:32:30.860 Because when you do

00:32:31.520 that signaling,

00:32:32.640 I think to Danielle's point

00:32:34.080 and Michael's and Kevin's,

00:32:35.040 like I think the government

00:32:35.920 will be shocked

00:32:37.860 as are most people

00:32:39.060 by the speed

00:32:39.960 at which change can happen.

00:32:41.040 But I think what is happening

00:32:42.620 right now,

00:32:43.120 and I'll say this

00:32:43.640 for major corporates

00:32:44.460 that we deal with,

00:32:45.400 a lot of them just have to say,

00:32:46.520 we'll be net zero by 2050.

00:32:48.080 I'll be gone.

00:32:49.260 You know, I'll be retired

00:32:50.080 and sitting somewhere

00:32:51.080 20 years before that happens.

00:32:52.580 But I might as well

00:32:53.340 put this in

00:32:53.820 because every one

00:32:54.360 of my competitors

00:32:54.960 has done it.

00:32:55.880 And some of the guys

00:32:56.620 that have gone further

00:32:57.700 have said we'll have a target

00:32:59.480 of 20, 30, 40% reduction

00:33:01.120 by 2030.

00:33:02.140 Now that's still eight years away.

00:33:03.500 I mean, any of us

00:33:04.300 that have held a corporate job

00:33:05.620 or any job of any kind

00:33:06.820 know that a lot changes

00:33:08.240 in your career

00:33:08.880 in eight years.

00:33:10.540 So it's a person

00:33:11.360 who's sitting there

00:33:12.040 making that decision

00:33:12.800 for their successor

00:33:13.880 and they can wash their hands off

00:33:15.420 and walk away from it.

00:33:16.460 And I think that's where

00:33:17.220 the urgency needs to be instilled

00:33:18.940 by the policymakers

00:33:20.280 and the governments

00:33:20.940 to say, look,

00:33:21.940 that's not good enough.

00:33:22.900 Let's set a target

00:33:23.520 for 2024, 2025.

00:33:25.260 And I think, you know,

00:33:26.340 the energy sector

00:33:27.040 has already showed

00:33:27.740 that, you know,

00:33:28.680 when that happens,

00:33:30.100 when there is an urgency

00:33:32.140 to change behavior,

00:33:32.960 because that is the way

00:33:34.020 to stay not just relevant,

00:33:35.460 but actually competitive.

00:33:36.560 And to Kevin's words,

00:33:37.700 win instead of just

00:33:38.480 being scared of losing.

00:33:40.120 Everyone will move.

00:33:41.160 And we're seeing this

00:33:41.780 in construction.

00:33:42.440 We're seeing this

00:33:42.920 with oil and gas.

00:33:43.980 And I think that's,

00:33:44.680 you know,

00:33:44.820 if you can move

00:33:45.500 large organizations

00:33:46.620 and industries like that,

00:33:48.440 there is no reason

00:33:49.220 why smaller industries

00:33:50.040 won't follow.

00:33:50.660 And I think that would be

00:33:51.680 the missing piece.

00:33:52.940 Instill that sense of urgency.

00:33:54.820 Force.

00:33:55.360 If you force every company

00:33:56.520 in Canada,

00:33:57.180 which is 200 employees

00:33:58.220 or more,

00:33:58.980 to have a 2025 goal

00:34:00.740 and start meaningfully

00:34:01.920 moving towards that,

00:34:03.080 I can promise you

00:34:03.920 the rate of change

00:34:04.640 and the rate of frustration

00:34:05.620 that you're maybe seeing here

00:34:06.860 would be quite different

00:34:08.140 in like a year's time.

00:34:09.600 But right now,

00:34:10.240 you can just say 2030

00:34:10.980 and you're fine.

00:34:12.980 Yeah, you're right.

00:34:14.220 We are on this side

00:34:16.240 of the discussion.

00:34:17.000 They're expected

00:34:17.560 to have a lot more

00:34:18.480 in the way of a concrete path

00:34:19.880 and a concrete roadmap

00:34:20.860 than the people

00:34:22.160 on the net zero side are

00:34:23.780 when they can just sort of

00:34:24.600 put these numbers out

00:34:25.640 and not really have to

00:34:27.360 have a solution

00:34:28.380 for how to get there.

00:34:29.660 Let me go to you, Kevin,

00:34:30.580 as we wind down here.

00:34:31.780 I know that there are,

00:34:32.800 as far as carbon removal

00:34:33.900 is concerned.

00:34:34.560 There are firms in Germany

00:34:35.800 that are doing some great work,

00:34:37.120 Singapore, the US.

00:34:38.740 How is Canada

00:34:39.820 in the competition here?

00:34:41.440 I mean, how is Canada

00:34:42.240 ranking and Canadian firms

00:34:44.420 and Canadian companies

00:34:45.640 in the global landscape

00:34:47.440 of players

00:34:48.260 that are in this space?

00:34:49.940 I'd say a close second,

00:34:51.880 but if Avatar

00:34:52.840 has anything to do with it,

00:34:54.040 we'll be number one

00:34:54.800 here pretty quick.

00:34:56.020 So, you know,

00:34:57.380 yes, this morning,

00:34:58.200 actually,

00:34:58.460 we just released

00:34:59.060 an announcement

00:34:59.960 that Avatar

00:35:00.740 has admitted

00:35:01.440 10 global companies

00:35:03.080 into an accelerator process

00:35:04.820 to compete for

00:35:05.840 Elon Musk's

00:35:06.980 $100 million

00:35:07.520 carbon removal X price.

00:35:09.780 So those are companies

00:35:10.440 from, as you mentioned,

00:35:11.380 Signaport, Germany,

00:35:12.580 and four from the United States.

00:35:14.740 The reason they want

00:35:15.720 to come to Calgary

00:35:16.720 and to Canada

00:35:17.500 is because we have

00:35:18.420 a world-leading

00:35:19.060 carbon technology

00:35:20.120 ecosystem and research.

00:35:22.420 We've partnered

00:35:22.840 with the University of Calgary.

00:35:24.760 The University of Calgary

00:35:25.880 born Carbon Engineering,

00:35:27.400 which is the largest

00:35:28.260 carbon removal company

00:35:29.400 in the world currently,

00:35:30.600 the Bill Gates

00:35:31.300 and Chevron

00:35:31.980 and Oxy Petroleum.

00:35:33.080 have invested

00:35:34.020 almost a billion dollars

00:35:35.240 in.

00:35:36.060 This is a race 1.00

00:35:36.740 we can win.

00:35:38.200 We have one of the

00:35:39.220 teams that actually

00:35:40.700 is Calgary-based

00:35:41.720 that we admitted

00:35:42.660 one of their founders

00:35:43.740 is one of the

00:35:44.960 employee number two

00:35:46.260 at Carbon Engineering.

00:35:49.220 Calgary and Canada

00:35:50.180 become Silicon Valley

00:35:51.360 of carbon.

00:35:52.400 And the next race 0.81

00:35:53.940 is going to be

00:35:54.460 around the carbon molecule.

00:35:55.800 And to finish on

00:35:56.340 Taurus's point,

00:35:57.320 the reason we're slow

00:35:58.060 to this is the hydrocarbon

00:35:59.000 is a really effective

00:36:00.320 energy storage molecule.

00:36:02.100 And CO2 is a really

00:36:03.900 tricky molecule

00:36:04.640 to manage.

00:36:05.820 But we've got all the tools

00:36:06.760 we've got to be able

00:36:07.400 to do this.

00:36:07.860 And I think this is going

00:36:08.560 to be the single biggest

00:36:09.580 investment opportunity

00:36:10.560 of our generation.

00:36:12.360 Let's go to Michael here

00:36:13.600 because I know that

00:36:14.640 the anti-hydrocarbon

00:36:16.260 narrative on this

00:36:17.780 is that carbon capture,

00:36:19.340 carbon storage,

00:36:20.220 these things

00:36:20.840 are dangerous,

00:36:22.200 they say,

00:36:22.640 because they prolong

00:36:23.440 the reliance

00:36:24.360 on fossil fuels.

00:36:25.720 The part of this

00:36:26.760 that I'm missing

00:36:27.340 is, well,

00:36:27.920 if we have fossil fuels

00:36:29.180 continuing to be used

00:36:30.280 and we also have

00:36:31.480 at the same time

00:36:32.160 these mechanisms

00:36:32.840 that eliminate

00:36:33.620 the negatives of that,

00:36:35.420 why is that a problem?

00:36:37.440 And I think the simple

00:36:38.740 answer is because

00:36:40.040 I think the problem

00:36:41.700 is not that

00:36:42.260 government should pick winners.

00:36:44.100 I think the problem

00:36:44.680 with just transition

00:36:45.440 is that they actually

00:36:46.080 are picking the winner.

00:36:47.100 They've decided

00:36:47.720 it's going to be

00:36:48.280 wind and solar.

00:36:49.220 And by the way,

00:36:49.700 I think there's 100%

00:36:50.800 a place for wind and solar

00:36:51.760 in our energy diet,

00:36:52.820 but they're picking it

00:36:53.840 as the solution.

00:36:55.520 And so, of course,

00:36:56.520 anybody who says,

00:36:57.020 well, I've now got

00:36:58.320 an opportunity

00:36:58.840 to have zero emissions

00:37:00.280 of oil and gas,

00:37:01.280 people aren't thinking

00:37:02.060 about, oh, well,

00:37:02.740 I guess that solves

00:37:03.400 the problem.

00:37:03.840 What they're saying

00:37:04.240 is, well,

00:37:04.460 that's slowing down

00:37:05.220 the transition

00:37:07.120 to our mandated solution.

00:37:10.520 So it's a government

00:37:11.440 picking winner's problem

00:37:12.380 if, as Danielle said,

00:37:13.920 the government

00:37:14.100 would just get out

00:37:14.700 of the way.

00:37:15.500 I mean, I would say

00:37:16.120 after your, you know,

00:37:16.940 2025 is way too far away.

00:37:18.960 I've been offered

00:37:19.440 140 bucks a ton.

00:37:20.640 If the Quebec government

00:37:21.460 would get out of my way,

00:37:22.320 we'd be doing it tomorrow.

00:37:24.680 Danielle,

00:37:25.260 I'll give you

00:37:25.500 the final word on this.

00:37:27.020 Man, I thought

00:37:27.720 Kevin had the mic drop moments.

00:37:29.120 I'm going to have to see

00:37:29.760 if I can do anything

00:37:30.740 better than that.

00:37:31.680 But one of the things

00:37:32.420 I would say is that

00:37:33.860 even if we all move

00:37:35.880 to zero emissions vehicle,

00:37:37.780 we still need asphalt

00:37:38.780 to drive,

00:37:39.540 to create roads

00:37:40.400 to drive on.

00:37:41.520 And so I think

00:37:42.060 that we're seeing

00:37:42.780 a transformation

00:37:43.580 in how we use bitumen

00:37:45.020 as well.

00:37:45.780 I can foresee a future

00:37:47.080 where we don't use

00:37:48.380 bitumen for combustion

00:37:49.280 at all,

00:37:49.920 that we find mechanisms.

00:37:51.440 And I know one company

00:37:52.320 that's already working on it

00:37:53.480 to inject the CO2

00:37:54.800 back into the bitumen,

00:37:56.180 split out the fines

00:37:57.280 and then use the bitumen

00:37:58.520 not only for asphalt

00:37:59.840 but also for construction materials.

00:38:01.420 If you look at carbon fiber,

00:38:02.860 carbon nanofiber,

00:38:04.220 it has properties

00:38:05.660 that might allow it

00:38:06.920 to be a better building material

00:38:08.540 than steel.

00:38:09.720 And if you can imagine that,

00:38:11.080 that we become the center

00:38:12.060 not only for hydrogen,

00:38:13.220 not only for CO2,

00:38:15.140 not only for all

00:38:16.140 the wonderful projects

00:38:17.160 that a purpose going to make,

00:38:18.440 but then also find a way

00:38:20.220 to use bitumen

00:38:21.220 to create these brand new

00:38:22.780 building construction materials,

00:38:24.000 the sky's the limit.

00:38:25.160 I just think that there

00:38:25.840 is immense opportunity

00:38:26.980 on all hydrocarbons

00:38:28.160 and that's the point.

00:38:29.280 If we're not shooting

00:38:30.580 carbon dioxide

00:38:31.500 into the atmosphere,

00:38:32.640 it shouldn't matter

00:38:33.640 that we're still continuing

00:38:34.580 to use it as a feedstock.

00:38:36.360 And I think that that's

00:38:37.020 the future we're moving

00:38:37.800 towards in Alberta.

00:38:39.420 Very well said.

00:38:40.600 Danielle Smith,

00:38:41.240 president of the Alberta

00:38:42.380 Enterprise Group,

00:38:43.320 Michael Binion,

00:38:43.960 founder of the

00:38:44.620 Modern Miracle Network,

00:38:46.120 Apoor Sinha,

00:38:46.920 CEO of Carbon Cycling,

00:38:48.840 and Kevin Crossert,

00:38:49.900 CEO and co-founder

00:38:51.020 of Avatar Innovations.

00:38:52.500 It's been a very informative

00:38:54.080 discussion for me

00:38:54.940 and I trust for the audience

00:38:56.060 as well.

00:38:56.480 So thank you to you all

00:38:57.260 for coming on.

00:38:58.160 It was a pleasure.

00:38:59.080 Thank you.

00:39:00.080 Thanks.

00:39:01.240 Thanks.

00:39:02.360 Well, that was fantastic.

00:39:03.680 And not me.

00:39:04.220 They were the fantastic ones.

00:39:05.800 I was just along for the ride.

00:39:07.460 I, you know,

00:39:07.920 I'm not a science person.

00:39:09.300 I understand a lot of the themes.

00:39:10.820 I certainly understand

00:39:11.540 the politics.

00:39:12.460 And I was nervous

00:39:13.600 going into that.

00:39:14.440 I'm like, oh,

00:39:14.720 they're just going to blow me

00:39:15.560 out of the water

00:39:16.140 with the technical stuff.

00:39:17.280 But I thought they did

00:39:18.020 a fantastic job

00:39:19.040 at really explaining this.

00:39:21.060 And the whole point is,

00:39:22.320 I almost believe the government,

00:39:24.360 I actually,

00:39:24.760 I do believe that

00:39:25.480 the government's approach

00:39:26.360 to this is to use science

00:39:28.900 as sort of a trump card.

00:39:30.480 You know,

00:39:30.960 it's we're talking

00:39:31.480 about the climate.

00:39:32.100 We're talking about science.

00:39:32.960 You can't disagree with us,

00:39:34.080 but we've just heard

00:39:35.080 from people that know

00:39:35.760 the science just as well.

00:39:36.940 In fact,

00:39:37.200 I'd say better

00:39:37.980 than most federal lawmakers

00:39:39.340 that are talking about

00:39:40.580 all the things

00:39:41.140 the industry is doing.

00:39:42.260 And they have a very simple

00:39:43.800 ask from the government.

00:39:45.060 Get out of our way.

00:39:46.380 They're not looking for money.

00:39:47.460 They're just looking

00:39:48.340 for the space

00:39:49.180 to do these things

00:39:50.400 that will align

00:39:51.280 with what the government

00:39:52.260 says are its objectives.

00:39:54.380 The question we're left with

00:39:55.540 is whether those are

00:39:56.360 the genuine objectives.

00:39:57.940 And it's looking like

00:39:58.860 they may not be.

00:39:59.840 And that's perhaps

00:40:00.740 why they aren't interested

00:40:01.800 in the oil and gas sector

00:40:03.400 solutions to it.

00:40:04.320 But we'll have more

00:40:05.180 to say on that

00:40:05.900 as the weeks and months

00:40:06.980 progress, I guarantee you.

00:40:08.440 Thanks to you all

00:40:08.980 for tuning in.

00:40:09.620 We'll be back next week

00:40:10.760 with more of Canada's

00:40:11.780 most irreverent talk show.

00:40:13.580 This is the Andrew Lawton

00:40:14.400 Show on True North.

00:40:15.320 Thank you, God bless,

00:40:16.680 and good day to you all.

00:40:18.280 Thanks for listening

00:40:18.920 to the Andrew Lawton Show.

00:40:20.440 Support the program

00:40:21.160 by donating to True North

00:40:22.400 at www.tnc.news.

Juno News - October 22, 2021

Justin Trudeau wants a ＂just transition＂ away from Canada's energy sector

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