HOUSTON — Prime Minister Justin Trudeau is in the heart of the U.S. oilpatch to make the case for investing in Canadian natural resources — while protecting the environment — at an influential global gathering of politicians and oil and gas executives.
"This is about making our economy more competitive and leaving our kids a cleaner environment," Trudeau said in a statement last week when his office announced the two-day trip to Houston.
It's the first time a Canadian prime minister has attended the annual CERAWeek conference, which brings more than 3,000 people — including legislators, energy executives, innovators and experts — from around the world.
Trudeau was to talk up the connection between resource development and taking care of the environment during Thursday night's keynote speech. The conference is also giving him an award for his stance in favour of sustainable development.
Prime Minister Justin Trudeau leaves Ottawa on March 9, 2017, en route to Houston, Texas. (Photo: Sean Kilpatrick/The Canadian Press)
Trudeau will participate in a roundtable discussion on the future of energy with Daniel Yergin, the vice-chairman of IHS Markit, the London-based research firm that organizes the conference.
The visit comes at a time when the energy industry, buoyed by a recent resurgence in the price of oil, and governments around the world are grappling with a dramatic shift in American politics.
Barack Obama, the former U.S. president, had emphasized the global fight against climate change as he neared the end of his time in the White House. That position aligned smoothly with Trudeau's commitment to transition to a low-carbon economy.
Obama's successor, Donald Trump, has vowed to boost fossil fuel production through easing regulations and building more pipelines, including the Keystone XL pipeline project that TransCanada proposed nearly a decade ago.
That pipeline, which the Liberal government supports, could bring Canadian jobs and help for the struggling Alberta economy.
Trudeau will be the first Canadian prime minister to attend the annual CERAWeek conference. (Photo: Sean Kilpatrick/The Canadian Press)
But Trump's anti-regulation and tough-on-trade approach could also challenge Trudeau's vision for a clean-energy future and the carbon-pricing plan he says will help bring it about.
Conservative MP Mark Strahl, the party's natural resources critic, said he wanted Trudeau to send a strong signal to international investors that the Canadian oilsands are still a good place to put their money for the long haul.
"We need to do everything we can to attract (foreign investment)," said Strahl, also in Houston for the conference.
The Conservatives have been highly critical of the Liberal plan to set a national price on carbon — beginning at $10 per tonne in 2018 — and to require all provinces and territories to have some form of carbon pricing in place by then.
That's frightening international investors away, Strahl suggested.
"All they're looking at is cost-certainty and the break-even price per barrel, and when you increase the costs on any sector like the government of Canada is doing, you risk becoming uncompetitive."
Trudeau's government has approved two pipelines: Trans Mountain's Kinder Morgan line and Enbridge's Line 3 rebuild — evidence, he's likely to argue, that his pro-environment government still supports developing natural resources.
Still, Thursday brought news of more international energy giants abandoning the Canadian oilsands: Netherlands-based Royal Dutch Shell and Houston-based Marathon Oil are selling their stakes to Canadian Natural Resources for $12.74 billion in cash and shares.
The move shows that at a time of lower crude prices, and the quick growth of less costly shale oil, foreign companies are taking another look at their investments in the costly and carbon-intensive Alberta oilsands.
Canada looking for 'common ground'
Trudeau's visit is part of ongoing Liberal government efforts to convince the Trump administration and other American legislators that keeping an open border benefits the economy — including the energy sector — in both Canada and the U.S.
On Friday, the prime minister is scheduled to meet with Greg Abbott, the governor of Texas, and Lisa Murkowski, the U.S. senator for Alaska. Both are Republicans.
David MacNaughton, Canada's U.S. ambassador and a key player in the government's outreach efforts, is also part of Trudeau's entourage in Houston.
Natural Resources Minister Jim Carr, who has been at the conference all week, told CNBC in an interview that Canada is looking for "common ground" with the Trump administration.
"I prefer to talk about opportunity than fear, and the way that you take advantage of opportunity is to make arguments and make friends," Carr said.
"And the arguments we're making is that the interests of Canada and the United States are actually aligned very well in the energy sector."