Ottawa set to unveil long-promised emissions cap for oil and gas sector

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The federal Liberals will finally provide details on their long-promised oil and gas emissions cap Thursday.

The policy is a critical piece of Canada’s long-term emissions reduction plan but Thursday’s framework will show the sector won’t be asked to cut emissions as deeply as previously thought.

The 2022 emissions reduction plan anticipated regulating that emissions from oil and gas in 2030 fall more than 40 per cent from current levels.

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Industry balked at that demand, saying it could not cut that much in just seven years without also cutting production.

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The government compromised and lowered its expectations in a bid to make the cap feasible without affecting production.

The Supreme Court of Canada has ruled that Ottawa can regulate greenhouse gas emissions but natural resources, and therefore oil and gas production, is solely provincial jurisdiction. That means any policy forcing production cuts opens Ottawa to another court challenge by the provinces.

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