On August 18, 2025, as global demand for critical minerals soars, Canada finds itself at a crossroads—torn between fueling the future with cleaner technologies and clinging to its legacy as an oil powerhouse. The stakes have never been higher, with economic growth, NATO’s defense spending targets, and the worldwide push for decarbonization all converging on the country’s vast natural resources. Yet, as the world edges toward peak oil demand by 2029, a chorus of experts and analysts is urging Canada to rethink its strategy before it’s too late.
According to a recent report by the International Institute for Sustainable Development (IISD), the prevailing narrative—one that equates more oil production with greater Canadian prosperity—is not just misleading, it could be outright damaging to the nation’s long-term fiscal health. The IISD’s analysis, largely ignored by mainstream Canadian media outlets, paints a sobering picture: up to two-thirds of future oil and gas capital investments out to 2040 risk turning into stranded assets if the world succeeds in limiting climate warming to 1.5 degrees Celsius. Even under current and announced climate policies, almost 40 percent of future fossil fuel investments would be uneconomic.
This is a far cry from the daily headlines in major Canadian newspapers, which continue to trumpet the supposed benefits of new pipelines and expanded oil production. Publications such as The Globe and Mail, CBC, Toronto Star, and Financial Post have been saturated with pro-oil commentary, often framing Canada as an emerging “energy superpower.” In July alone, readers saw headlines like “To be an energy superpower, Canada must set aside flawed green ideology” and “Majority of Canadians support building new oil infrastructure, poll shows.”
But behind the media blitz, the numbers tell a different story. Oil and gas extraction currently contributes just three percent to Canada’s GDP and less than one percent of government revenues and jobs, according to the IISD report. Automation has already eliminated over 25,000 jobs in the sector between 2014 and 2021, and further losses are projected to wipe out about 30 percent of the remaining workforce by 2040. “Doubling down on increased production will lead to less government revenue as the energy transition accelerates,” the IISD warns. In fact, public returns from fossil fuel extraction would be $3 billion higher if Canada avoided investing in infrastructure that is likely to become obsolete in the coming decades.
Meanwhile, global demand for metals critical to cleaner technologies is growing at a breakneck pace. Canadian per capita income has surged by about 120 percent since 2000, fueling demand for metals used in everything from infrastructure and construction to machinery and consumer electronics. Copper, a bellwether for the clean tech revolution, illustrates the scale of the challenge: in 2024, global production stood at 23 million tonnes, but by 2040, demand is projected to reach 34 million tonnes, with 12 million tonnes earmarked for clean technologies alone.
Meeting this demand won’t be easy with traditional industry approaches, which tend to favor massive, capital-intensive mining operations. The dominant model in Canada has long assumed that only established mining giants can develop and operate large-scale mines. While this approach delivers efficiency and investor returns when deposits are large, it leaves smaller deposits—and other sources of metals—largely untapped. As a result, valuable metals in small mines, mine waste streams, historical mine waste, and recycled metal waste often go overlooked.
To unlock Canada’s mineral wealth, experts are calling for a fundamental rethink of how the country organizes its mineral resources industry. The federal government is being urged to encourage broader private sector participation, including smaller, more flexible operations and innovative extraction technologies. Chemical and biological methods targeting mine waste, scrap, and industrial waste could open up new avenues for supply, while public-private partnerships and streaming companies (which provide capital in exchange for a share of future metal output) could help develop otherwise idle resources.
“The entrepreneurial spirit of the general public, with support and incentives from government and industry, can be mobilized to help implement a wide variety of different business models,” argue analysts in Policy Options. They note that smaller mining operations have the flexibility to adapt to market changes and orebody variations, making them more resilient in a fast-moving global market.
The Canadian Climate Institute estimates that $30 billion in investment will be required over the next 15 years to fully realize the country’s mineral resource potential. But the path forward is riddled with challenges: time, infrastructure needs (like roads, power, and water in remote areas), and a shortage of professional mine designers and operators all pose significant constraints. Perhaps most daunting is the physical, environmental, and socioeconomic footprint of mining—issues that only grow more complex as projects scale up.
Proposed solutions focus on government action to build metals literacy and spur investment. Start-up capital, particularly for community-driven models such as the Indigenous Natural Resource Partnerships program, could help foster broader participation. At the same time, a national campaign to raise awareness of the critical role metals play in Canadians’ lives—and in the country’s economic security—could lay the groundwork for a more robust “Buy Canadian” movement. This, advocates say, would not only create opportunities for technological and organizational innovation but also help secure the social license needed for new projects to proceed.
Yet, as the nation debates its future, the political winds are swirling. The recently passed bill C-5 grants the federal cabinet sweeping new powers to fast-track infrastructure megaprojects deemed in the “national interest,” a move widely seen as a lifeline for the oil industry’s last big push for new pipelines and infrastructure. The oil patch and its allies are lobbying hard, hoping to capitalize on what many see as their final opportunity to expand before global demand peaks and begins its inevitable decline.
But as DeSmog points out, there are risks lurking beneath the surface—risks that go beyond the environment and reach deep into the financial system. Seventeen percent of corporate lending, bond, and equity underwriting at Canada’s Big Five banks is tied to fossil fuels, with 68 percent of that exposure focused on domestic oil and gas companies. The Bank of Canada and the Office of the Superintendent of Financial Institutions estimate that by 2050, the probability of default will jump by 150 percent for conventional oil extraction and a staggering 400 percent for oil sands, compared to current levels. A sudden loss of investor confidence could trigger a cascade of bad debts, rising borrowing costs, and a loss of consumer confidence—potentially undermining the broader Canadian economy.
For Prime Minister Mark Carney, who has weathered past financial crises, the message is clear: Canada’s future prosperity depends on credible, fact-based analysis and bold, forward-looking decisions—not industry-sponsored hype or nostalgia for a fading era. The choices made now will reverberate for decades, shaping not just the economy but the country’s role in a rapidly changing world.
Canada stands at a pivotal moment, where embracing innovation, supporting new business models, and investing in critical minerals could secure its place in the clean energy future—while doubling down on oil may only lead to stranded assets and financial risk. The path forward demands courage, creativity, and a willingness to break from the past.
