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In a stunning decision on Sunday, Teck Resources withdrew its application to build the $20.6-billion Frontier oilsands mine in Alberta, just days before the Trudeau government’s cabinet was expected to decide whether the project could proceed, citing Canada’s “inability to reconcile resource development and climate change.”

The Teck withdrawal is more proof that Canada’s uncertain investment climate and energy policies have made it almost impossible to do business in this country, which has ramifications far beyond the energy sector and Western Canada.

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Recent investment data underscores the deteriorating investment climate in Canada’s energy sector. Between 2016 and 2018, the United States enjoyed a more than 2½ times increase in investment in its upstream oil and gas sector (essentially, exploration and production) compared to Canada.

Uncertainty — political, economic or regulatory — adversely affects investment because firms and entrepreneurs must make long-term decisions about how best to allocate their scarce capital. Jurisdictions with predictable stable environments are much more attractive than jurisdictions characterized by uncertainty.