Canada-EU Energy Alliance Aims to Bolster Europe's Security

Canada and the European Union are exploring a potential energy alliance to bolster Europe's energy security. This new partnership could provide a stable gas supply for Europe through swap contracts, where cargo headed from British Columbia to Asia can be traded with another one half a world away.

European companies have already signed agreements to buy liquefied natural gas from the Ksi Lisims LNG plant planned for the northern B.C. coast. However, experts say it's unclear whether a European player would want to commit to a project that would take tens of billions of dollars and years to complete.

Canada has pipelines and port infrastructure to export oil and gas from the West Coast to Asia, but not on the East Coast. Alberta Premier Danielle Smith and Ontario Premier Doug Ford floated a plan called the Northern Shield Energy Corridor to ship Alberta crude to refineries in Sarnia, Ont., with the potential of opening up new export paths via the Atlantic.

Werner Antweiler, an economist at the University of British Columbia, said European demand alone will not see such a project come to fruition. R.J. Johnston, director of energy and natural resources policy at the University of Calgary's School of Public Policy, agreed that Asia remains the more promising avenue for Canada to diversify its exports.

Other avenues for Canada to boost its energy trade with Europe include biofuels and hydrogen, as well as critical minerals such as cobalt, copper, graphite, lithium, nickel, and rare earth elements. A report from Clean Energy Canada highlighted how Canada can seize the opportunity in the electrification economy by focusing on trade in these key minerals.