Alberta’s Minister of Energy Sonya Savage announces expanding coal mining restrictions on the Eastern Slopes of Alberta in Calgary, Friday, March 4, 2022. THE CANADIAN PRESS/Todd Korol

By Amanda Stephenson in Calgary

As governments around the world grapple with how best to assist citizens with the rising cost of living, Alberta’s energy minister is warning that anything resembling the U.K.’s so-called “windfall tax” on the profits of oil and gas companies must not be implemented in Canada.

The British government last month announced plans for a 25 per cent windfall tax on the profits of oil and gas companies, with the aim of raising funds for cash payments to help millions of British citizens cope with rapidly rising energy bills.

Globally, oil and gas companies are earning record profits in 2022 as surging demand for energy and the war in Ukraine pushes commodity prices to sky-high levels. Spain and Italy have already approved similar-style taxes on energy companies to help citizens pay for their lights and fuel, while recent news reports quoted a senior White House advisor as saying the Biden administration is actively looking at what a windfall tax could look like.

But Alberta Energy Minister Sonya Savage said Wednesday if Canada were to take similar steps, it would be considered an “extreme act of aggression” against provincial constitutional authority.

“If they (Ottawa) were to impose a windfall tax on the profits of the oil and gas sector in Alberta at this time, you will see an unprecedented ‘fire on the prairie’ of regional alienation,” Savage said.

The Trudeau government has not proposed a windfall tax on Canada’s oil industry, which has only very recently emerged from nearly a decade of rock-bottom prices, limited investment, consolidation and layoffs.

However, some environmental groups and non-profits have publicly called for one.

“Oil and gas companies must not be allowed to profiteer while people suffer the consequences,” activists with the Climate Action Network wrote in a letter to the federal government in March.

“A windfall tax on oil and gas such as the one proposed by the European Commission should redirect revenue to the communities and families most affected by the rising prices.”

In Canada, the Constitution gives provinces the authority to manage their own non-renewable resources. Alberta has a history of opposing any federal action it believes oversteps that authority, such as the 2019 Impact Assessment Act, which allows the federal government to consider the impacts of new infrastructure or resource projects on issues such as climate change and was derisively referred to by opponents as the “No More Pipelines Act.”

Savage said Wednesday that while a tax on oil firms is not the answer, the federal government does need to do something about energy affordability for consumers.

“That is going to be the number one issue on the ballot as we go forward,” she said. “The cost of everything is rising, and if we (politicians) don’t address it, we are going to have another backlash.”

– With files from the Associated Press

This report by The Canadian Press was first published June 8, 2022.

The Canadian Press

News from © The Canadian Press, 2022. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

  • 0045 WBPC 2023 Bright Colors P
    0045 WBPC 2023 Bright Colors P
  • 0044 PTRC CCUS Aquistore
    0044 PTRC CCUS Aquistore
  • 0043 ALX ten sizes
    0043 ALX ten sizes
  • 0042 Sask Oilfield Services
    0042 Sask Oilfield Services
  • 0039 Summit ESP Saskatchewan lower third
    0039 Summit ESP Saskatchewan lower third
  • 0041 DEEP Since 2018 now we are going to build
    0041 DEEP Since 2018 now we are going to build
  • 0040 Southeast College safety tickets
    0040 Southeast College safety tickets
  • 0033 Buffalo Potash Jared Small Footprint
  • 0032 IWS Summer hiring rock trailer music
  • 0029 Latus Viro updated Latus phone
  • 0025 Kendalls
  • 0026 Buffalo Potash Quinton Salt
  • 0023 LC Trucking tractor picker hiring mix
  • 0022 Grimes winter hiring
  • 0021 OSY Rentals S8 Promo
  • 0019 Jerry Mainil Ltd hiring dugout
  • 0018 IWS Hiring Royal Summer
  • 0014 Buffalo Potash What if PO
  • 0013 Panther Drilling PO ad 03 top drive rigs
  • 0011
  • 0006 JK Junior
  • 0004 Royal Helium PO Ad 02
  • 9001
  • 0002