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ST. JOHN’S — The chief executive of Cenovus Energy says it feels like a “new day” for the oil and gas industry, as Canada appears willing to shift its stance on emissions regulations.
Jon McKenzie told reporters in St. John’s, N.L., Wednesday he feels attitudes are changing toward the industry, opening doors for new developments and opportunities.
“We can produce oil responsibly, but we also have to recognize the benefits that oil and gas bring to us, economically,” he said.
“I think there is a grand bargain, and I think people are starting to understand that what we really need is to grow our industry economically, but do it as responsibly as we possibly can.”
McKenzie was in Newfoundland and Labrador to mark 20 years of production at the offshore White Rose oilfield and the approaching completion of the West White Rose expansion project, which will enable to field to produce for another 14 years. The celebration came as the province’s new premier was in Ottawa to ask Prime Minister Mark Carney to designate another planned offshore oilfield — Equinor’s Bay du Nord project — as a major project of national interest.
Carney, meanwhile, is expected to unveil details of a memorandum of understanding with the Alberta government on a pipeline project while in Calgary on Thursday.
Like the head of Cenovus, Alberta Premier Danielle Smith has also spoken of a “grand bargain,” which would see a proposed carbon capture project move forward alongside an oil pipeline to the B.C. coast.
Led by Canada’s largest oilsands operators, including Cenovus, the project would aim to capture carbon dioxide emissions from more than 20 oilsands facilities and transport them 400 kilometres away by pipeline to a terminal in the Cold Lake area, where they would be stored underground.
For climate scientist Damon Matthews, the so-called bargain misses the point. “It’s not a grand bargain. It’s a bit of a swindle job, really,” he said in an interview. The Concordia University professor said oil companies have centred discussions about greenhouse gas emissions around the extraction process, when climate change is driven by burning oil once it has been removed from the Earth.
“There is no real carbon capture technology for oil,” he said. “Most of the oil in the world is burned in vehicles, and there’s no way of capturing that.”
The world is on track to warm by about 3 C by the end of the century, Matthews said.
“That is not a world that we want to live in,” he said, adding that it would be “catastrophically dangerous for most of the population.”
Canada also appears willing to shift its stance on emissions regulations. The federal budget this month included the prospect of removing the planned emissions cap on oil and gas production.
Jim Keating, chief executive of Newfoundland and Labrador’s oil and gas corporation, said the cap — scheduled to come into force in 2030 — discouraged exploration and investment in the province’s offshore. Equinor’s decision to pause Bay du Nord and find ways to make it more affordable also deterred investment in the sector, he said.
Keating said he is confident Bay du Nord will proceed, inspiring new investment and exploration. The deepwater oil project was approved by the Liberal government under former prime minister Justin Trudeau in 2022, with a condition that by 2050, all of its production emissions must be captured and stored.
Carney, however, “has taken a different approach,” said Kody Blois, Carney’s parliamentary secretary and a Liberal member of Parliament for Nova Scotia.
“We still are committed to our climate targets, but at the same time, we recognize that certain provinces or regions of the country may go about that a different way,” Blois told reporters in St. John’s.
There are currently four oil installations operating off the east coast of Newfoundland. Collectively, they have delivered more than $20 billion in royalties to the provincial treasury since 1997.
This report by The Canadian Press was first published Nov. 26, 2025.
— With files from The Associated Press
Sarah Smellie, The Canadian Press
