Jason Kenney bends truth on oil, equalization as he meets with Quebec counterpart

Alberta Premier Jason Kenney pitched his province’s energy sector as the financier of Quebec social programs as he tried to find a new provincial ally in his ongoing tussle with the federal government Wednesday. 

The Alberta leader is hoping to build stronger ties with Quebec amid a dispute with Ottawa over legislation that seeks to add environmental regulations to oil industry development.

He met Premier François Legault in Quebec City Wednesday afternoon.

“We have a lot of things to talk about, [like] how to stop Ottawa from interfering in our joint jurisdictions as provinces,” Kenney said before heading into the meeting with Legault that lasted roughly an hour.

Earlier in the day, Kenney repeated several misleading claims about Quebec’s oil consumption and the federal equalization payments program, which did not sit well with some politicians in the province he is trying to court. 

“The $13 billion in equalization payments that form a large part of Quebec’s revenues comes disproportionately from Alberta and from our energy sector,” Kenney told reporters in Montreal.

Because of that money, he said, Quebec should be prepared to support his government’s quest to build a cross-Canada oil pipeline — or at least move forward with a project that would see natural gas from Alberta refined in Quebec.

‘We have a lot of things to talk about, [like] how to stop Ottawa from interfering in our joint jurisdictions as provinces,’ Kenney said before his meeting with Premier François Legault (right). (Jacques Boissinot/Canadian Press)

Supporters of a new cross-Canada pipeline to bring Alberta oil to terminals in new Brunswick — a revised version of the Energy East project that TransCanada pulled the plug on in 2017 — have been frustrated by Legault’s refusal thus far to back the project. 

“If you want to accept equalization payments that come from Alberta energy, then please help us to develop that energy and get a fair price for it,” Kenney said.

Yet the $13.1 billion Quebec is due to receive under the equalization program in 2019-2020 only accounts for only around 11 per cent of the province’s consolidated revenues. Personal and consumption taxes are Quebec’s largest revenue sources. 

Kenney’s portrayal of Alberta money heading directly to Quebec coffers also misrepresents how the equalization program actually works. It is a sum of money the federal government redistributes from taxes it collects across the country, not just from Alberta.

Where does Quebec’s oil come from?

While Kenney acknowledged the widespread environmental concerns surrounding fossil fuels, he also said that Quebec currently consumes around 60,000 barrels of oil daily. 

“A lot of that comes from foreign sources,” Kenney said. Without added pipeline capacity, according to Kenney, domestic demand for oil would be filled by countries with poor human rights records, including Russia and Venezuela.

“I’d rather that it be purchased from Canadian sources, helping to pay for Quebec social services, rather than buying foreign oil,” Kenney said.

With Kenney pushing for more oil and gas development in Quebec, provincial opposition parties warned Legault against giving in to Alberta’s demands. (Jacques Boissinot/Canadian Press)

However, since 2015, the vast majority of oil refined in Quebec comes from North American sources. Figures released by the National Bank last year indicate that less than 20 per cent of Quebec’s oil comes from overseas.

Moreover, as several observers have pointed out, refineries buy oil on the open market. Their suppliers fluctuate based on global prices, not on instructions from the provincial government.

Opposition wary of meeting

At his speech to an economic forum in Montreal, Kenney also talked up the benefits of a proposal to build a natural gas pipeline and refinery in Quebec.

He said the project would actually help reduce emissions over the long term by helping displace coal-fired plants in the developing world.

Legault has thus far been steadfast in his refusal to consider a cross-Canada oil pipeline being built across Quebec. (Ryan Remiorz/Canadian Press)

Legault has repeated similar arguments while signalling his own support for the project, which is still at the environmental assessment stage.

A group of 150 scientists signed an open letter last week that casts doubt on the arguments of the two premiers. The scientists estimate Quebec’s LNG project will generate CO2 emissions equivalent to what 382 million cars produce, on average, over a one-year period.

“These facts are thoroughly inconsistent with the claim that [the project] would be part of the solutions to ecological emergency,” the letter said.

With Kenney pushing for more oil and gas development in Quebec, provincial opposition parties warned Legault against giving in to Alberta’s demands. 

“Pride is not bending over backward when Jason Kenney tries to make us feel guilty,” Manon Massé, co-leader of the left-leaning Québec Solidaire, said Wednesday during question period.

“Quebec shouldn’t be ashamed of wanting something other than their dirty energy.”

Legault emerged from the meeting Wednesday saying he remains opposed to the oil pipeline.