Oil, Transitions, and the Blue Economy in Canada

Abstract

Decisions about whether to include oil in blue economy plans can be controversial but also fundamental to the ability of these plans to transform (or not) business-as-usual in the oceans. This paper examines (a) how oil is sometimes included and justified in blue economy planning when its development is at odds with climate commitments and the need for just transitions away from fossil fuels, and (b) how oil could be included in blue economy planning, or transitions to blue economies and just energy transitions away from oil. We examine how tensions between sustainability/climate commitments and oil development impacts are resolved in practice, specifically by analyzing a particular approach to the blue economy that focuses on technology and innovation. The overlap of oil with renewable energy, specifically through technology, has become an important part of recent ocean and blue economy narratives in oil-producing nations and illustrates the contradictions inherent in ocean development discourse. We draw specifically on the case of Newfoundland and Labrador (NL), the only province in Canada with a mature offshore oil industry and thus the region most potentially impacted by decisions about whether to include oil in Canada’s blue economy. We argue that the blue economy approach to ocean governance being enacted in NL is currently being used as a form of legitimation for continuing the development of oil with no real transition plan away from it. Furthermore, we argue that blue economy plans must not only envision transitions to renewables but also explicitly and actively transitions away from oil to minimize environmental and social justice and equity issues at multiple scales. We end by highlighting some necessary conditions for how ocean economies that include oil can transition to sustainable and equitable blue economies.

1. Introduction

Climate change is now front and center in both regional and global environmental policy and governance, and there is an increasing understanding that our climate commitments are incompatible with further pursuing fossil fuel extraction [1]. The recognition that seriously addressing climate change will require fundamental changes to our energy systems and our economies has led to calls for just transitions—that is, ensuring that the transition away from fossil fuels and towards renewable energy does not leave behind workers and marginalized people [2,3,4,5]. In the ocean, this call for just transitions has coincided with the emergence of the concept of the “blue economy,” an approach to ocean governance that emphasizes ocean development that is sustainable, equitable, and just [6]. Given these emphases, blue economies potentially provide space for shifts toward more equitable and sustainable energy production in the ocean. The problem, however, is that some blue economy plans include or foresee oil extraction as a key component, which is not only contrary to meeting climate commitments but also tends to negatively affect environmental conditions and further marginalize coastal communities [7]. This highlights the need for blue economy research and scholarship that engages with the tensions and contradictions of blue economies in real spaces and the equity and justice issues that result from them at multiple scales. Using a case study approach, this paper specifically addresses the conflict between blue economy narratives and actions in order to inform the research, practice, and governance of ocean spaces worldwide.

Our paper problematizes the inclusion of oil in blue economies, asking (a) how oil is sometimes included and justified in blue economy planning even though it is fundamentally at odds with climate commitments and the need for just transitions away from fossil fuels, and (b) how oil could be included in blue economy planning—that is, how it could be part of transitions to blue economies and just energy transitions away from oil. We do this by first examining the emergence of the blue economy as a broad concept that has been adopted in global governance spaces, but that has to be interpreted and enacted in regional policy and development. We focus on the emerging blue economy in Canada and specifically how it is being operationalized in Newfoundland and Labrador (NL), the only Canadian province with an existing and mature offshore oil industry. We examine how the blue economy concept has evolved and been put into practice in NL and the implications of this for climate commitments, equity, and justice at different scales. This involves exploring inconsistencies between high-level blue economy discourse and regional blue economy planning and implementation. Finally, we offer broad recommendations for moving forward with blue economies so that they take the reality of oil and the climate crisis into account and thus contribute to the alignment of blue economy goals at national, sub-national, and regional scales.

While there is ample literature on the environmental problems and injustices associated with the expansion of the oil industry as well as the emergence of the blue economy, both as a concept [8,9] and its regional manifestations [10,11,12], little has addressed both. That is, little work has addressed the tensions of continued oil industry expansion in the face of the climate crisis in specific regions framed as “blue economies,” an increasingly prominent governance approach guiding ocean development worldwide. This is an important research gap, as global calls for sustainable and equitable oceans continue at the same time as offshore oil development expands and the climate crisis intensifies. This paper examines how the contradiction of including oil in a regional blue economy is addressed on the ground and what this means for just and equitable energy transitions. Our work is thus part of a growing scholarship considering justice and equity in ocean spaces that are being framed and organized as blue economies [13,14,15,16]. We contribute to this scholarship by using our case to focus on transitions, specifically away from unsustainable ocean industries and toward just and equitable blue economies. This is an important aspect of just energy transitions that needs urgent attention given the growing global emphasis on developing regional ocean economies [17].

2. Background: Making Sense of Oil in Blue Economy Plans

The blue economy is a governance concept that has become increasingly influential in international discourse and national policy and planning processes in the past decade. Broadly speaking, it is a way of organizing ocean space and development—through specific policies and initiatives—for the purpose of achieving simultaneous improvements for society, the environment, and the economy. It thus builds on the general notion of sustainable development [8,9]. What distinguishes the blue economy from the ocean economy more broadly is that it emphasizes sustainability and integrated management across sectors to achieve normative well-being and development goals. In other words, it is more than just an accounting of economic activities and benefits (specifically employment and GDP) from disparate economic activities associated with the oceans and coastal areas [9]. The concept has increasingly been used by ocean nations over the past decade, particularly by Small Island Developing States (SIDS) looking to more equitably and sustainably benefit from the ocean [8]. It has also been adopted into global ocean governance through the High Level Panel for a Sustainable Ocean Economy (henceforth referred to as The High Level Panel), a group of ocean nations (of which Canada is one) that came together in 2018 to work toward sustainable ocean economies that include ocean equity as a key pillar [6]. Thus, the blue economy concept, as it is now used on a global scale, implies that there is a general vision about what a blue economy is or should be: an ocean economy that considers the social, environmental, and equity factors alongside the economic. At the same time, however, it is up to nations and specific regions to determine what this means and how to achieve it.

This lack of a shared and broadly agreed-upon definition is problematic because it means that blue economy language can be used by actors to mean whatever is most useful to promote their interests [18]. Christiansen and Schutter [19] (see also [20]) refer to the blue economy as a “boundary object,” something that can be applied and interpreted in concrete situations but is still versatile and appealing to many different actors [21]. However, this versatility may mask incompatible interpretations and inevitable trade-offs that are attached to a boundary object when brought into practice [21,22,23], as well as the role of power in enacting specific interpretations [8]). Thus, while the blue economy concept has gained widespread international use, specific uses can include a variety of (sometimes conflicting) definitions and narratives. These narratives involve different understandings of the role and place of oceans in communities and economies and, consequently, also different economic, environmental, and social emphases in practice. Voyer et al. [9] (p. 604) explain four specific narratives, which include viewing oceans as “good business,” “drivers of innovation,” sources of natural capital, and important to livelihoods. Whether or not the oil and gas industry is included in a blue economy thus depends on which of these narratives or understandings is adopted by those with decision-making power. Indeed, a natural capital approach to the blue economy would likely exclude oil and gas, while approaches focused on business and innovation would more likely include them [9].

Oil development, however, is at odds with sustainability, equity, and justice as it involves environmental and social problems and risks. In the ocean, oil spills can have impacts on regional environments, wildlife, and economies, as seen after the Deepwater Horizon offshore well blowout in the Gulf of Mexico [24,25]. Even small spills or chronic discharges around platforms can lead to significant impacts on wildlife, particularly seabirds, whose feathers can suffer loss of waterproofing and insulating properties from oily water [26]. Oil development has been associated with negative health [27] and human rights issues [28,29], including the rights of future people to a healthy environment [30]. It has also led to environmental justice struggles, for instance, over the distribution of health impacts from flaring [31] and opportunities to participate in regional developments [32,33]. Moreover, although there can be local economic benefits from oil production, these benefits tend not to reach people evenly or equitably. For instance, jobs in the oil industry—specifically well-paid jobs—predominantly go to men [34,35,36]. Such inequalities in resource development are also greater for Indigenous women and girls [37]. More broadly, greenhouse gas (GHG) emissions, which result not just from the production of oil but the consumption as well, are impacting ocean temperatures and ecosystems [38] and thus the lives and livelihoods of people around the world (albeit very unevenly).

These problems associated with oil highlight an important point about the geography of oil development impacts, which is that they are not confined to the regional sites where oil is produced. The environmental, equity, and justice issues resulting from oil production extend along the whole supply chain [39,40]. Yet, there is a clear disconnect between sites of oil production and associated regulatory processes and planning on the one hand, and on the other, the locations where oil is consumed or where climate change impacts and injustices are experienced [40,41]. With research increasingly pointing to the need to address the supply side of fossil fuels—to curtail production rather than just consumption—in order to meaningfully address climate change and meet climate commitments [1,42], regional policy and planning that takes the life cycle of oil into account is critical. In ocean spaces, this means that regional blue economy planning (and what activities/industries are included in blue economies) is key to fulfilling high-level international commitments related to sustainable oceans and climate change. However, these high-level goals are often misaligned with what is happening in regional spaces. Indeed, there are several countries that have committed to a certain vision of sustainable and equitable blue economies through participation in the High Level Panel and yet reinforce unsustainable ocean practices in their national and sub-national policies. For instance, Norway issued 61 new licenses for oil and gas exploration just weeks after publicizing its commitment to ocean sustainability [43]. Similarly, Canada has continued to support the expansion of its offshore oil industry through policies, incentives, and grants, despite parallel commitments to reduce GHG emissions. Understanding this contradiction thus requires understanding these international commitments in the context of national and regional interpretations, implementation, and trade-offs associated with blue economy planning and action. Given available plans and observed actions, the main research questions we consider are (1) how is the idea of the blue economy being mobilized in NL (and Canada more broadly) and (2) what are the implications of these current implementations for just energy transitions and climate action at multiple scales?

3. Methods: Canada’s Oily Blue Economy

The “blue economy” has been gaining attention in Canada recently, particularly after Canada co-hosted (with Kenya and Japan) the 2018 “sustainable blue economy conference” [44]. In September 2020, after months of lockdowns and economic slowdowns from the pandemic, the federal throne speech highlighted the need to “build back better,” part of which included building the blue economy [45]. In December 2020, the High Level Panel released “Transformations for a Sustainable Ocean Economy: a Vision for Protection, Production and Prosperity”, which was deemed a “roadmap” for the countries involved to “build a sustainable blue economy” [46]. The Canadian government stated its intentions to do this “through fishing, marine transportation, shipbuilding, energy, tourism and recreation, and other ocean industries” [46]. It later released a public engagement paper [47] for what will eventually be the country’s blue economy strategy, which laid out an initial vision and goals for the country’s blue economy: to provide jobs, protect the environment, and grow the economy, but all in ways that simultaneously protect the ocean/environment and consider climate change and equity. Although the blue economy strategy has not yet been released, the engagement paper makes it clear that offshore oil is envisioned as part of it. The paper notes that offshore oil and gas is the third largest sector in Canada’s current blue economy, contributing about 15% of Canada’s ocean sector GDP, most of which is coming from NL’s offshore oil industry [47] (p. 6). Thus, NL will play an important role in enacting Canada’s blue economy vision. How oil in the province is developed and what the long-term plan is for it is thus vitally important to Canada’s ability to fulfill its high-level blue economy discourse promises.

In this paper, we explore the tensions and contradictions involved in high-level blue economy commitments (such as those of Canada noted above) and the policies and practices in regional spaces. We do this through taking a qualitative case study approach, examining the oil industry in NL and the emergence of a particular approach to organizing its ocean economy that now draws on blue economy discourse that aligns with Canada’s more recent high-level blue economy planning. We examine how tensions between climate commitments and oil development impacts are resolved in practice and the implications of this for climate/sustainability and equity. The main methods used were document and media analysis. We searched provincial government throne speeches between 2001 and 2021; media and news releases from the government of NL website and archive between 1996 and 2021; and the general government of NL website for the following search terms: blue economy, ocean economy, and blue growth. These searches provided general context and background as well as pointed us toward specific key government documents and strategies that we examined in more depth. These documents are introduced and discussed in the sections below. A broader scoping review, which included a media scan and general internet search using the same search terms as above in relation to NL, provided examples of how the government and other organizations and groups, particularly industry and industry organizations, are publicly employing blue economy-related terms and ideas.

4. Results and Discussion: NL’s Technology and Innovation-Based Blue Economy

NL is a small rural province of about 500,000 people on the east coast of Canada, located on the traditional territory of diverse Indigenous peoples, including the Beothuk, Mi'kmaq, Innu, and Inuit. The island of Newfoundland was originally colonized by Europeans because of its significant fish resources, and thus fish economically and geographically organized the province for hundreds of years. However, in the 1960s, exploration for offshore oil began, with the first oil field, Hibernia, discovered in 1979. Hibernia’s development became increasingly important in the early 1990s when the cod stock collapse led to a moratorium on the fishery. The province invested heavily in the development of Hibernia, including building intellectual, technical, and infrastructural capacity to ensure the future of the oil industry. First oil production from Hibernia began in 1997 and since then, three other fields have been developed. With these developments, the oil industry has become increasingly economically important, providing provincial revenue, direct jobs in the oil industry, and indirect and support jobs. Significant GDP and government revenue has come from oil, specifically starting in the early 2000s. For instance, in 2004, offshore oil royalties accounted for only about 3% of government revenue [48] (p. 16); however, this increased to 24.6% in 2008 [49] (p. 17) and reached 31.7% in 2012 [50] (p. 17). Along with increases in benefits, however, there have also been economic problems associated with depending so much on oil. These became particularly evident in 2014 when the price of oil collapsed and more recently with pandemic-related price drops. Although the province’s approach to recovering from these economic downturns has long put emphasis on expanding the oil industry, how this industry is framed and situated more broadly has undergone some key changes, which we address in the sections below.

4.1. NL’s Emerging Ocean Economy: Economic Growth through Technology and Innovation

In 2006, the province released an innovation strategy, which was premised on the idea that NL should not just sell its raw materials “to the highest bidder” as it used to but rather should “find innovative ways to add value” to these resources [51] (p. 3). Ocean technology was among the “strategic high-growth sectors of the economy” [52] (p. 8) identified. As the strategy notes, the province was already “excelling” in this sector, but the aim was to expand opportunities for growth and commercialization, to help position the province more prominently in the global economy so that it could benefit more from existing resources.

The importance of the ocean technology sector in NL was then specifically addressed in 2009 when the province launched Oceans of Opportunity: Newfoundland and Labrador’s Ocean Technology Strategy. This CAD 28 million strategy covered five years and was meant to expand the provincial blue economy. It lays out the government’s blue economy “benchmark,” which was “$1 billion in revenue by 2015 up from $250 million today” [53] (p. 4). Then Premier Danny Williams explains in his introduction to the strategy that “An innovative and progressive ocean technology sector has extended from the province’s strong connection with the ocean. It is a sector that has capitalized on Newfoundland and Labrador’s natural abilities, natural environment and natural requirements positioning it as the pre-eminent leader in the global blue economy” [53] (p. 3). Thus, the strategy aimed to build on the province’s history of ocean-based industries as a way to expand economic activity through the ocean technology sector.

Although Oceans of Opportunity focused specifically on the ocean technology sector broadly as a driver of the province’s blue economy, how it positions the oil industry is noteworthy. The strategy emphasizes the role of technology as “an enabler of ocean industries such as offshore oil and gas” [53] (p. 9). At the same time, it taps into the growing interest at the time in Arctic oil development, something fuelled by high oil prices and estimates that the Arctic could have significantly more oil and gas than previously thought [54]. Indeed, Oceans of Opportunity explains that “offshore oil exploration is increasing in harsh environments that require increasingly innovative technical solutions” [53] (p. 10)—solutions that NL’s ocean technology sector could supply. Thus, one aspect of how Oceans of Opportunity played out over the course of its five years was to use ocean technology (specifically Arctic-relevant technology and innovation) to try to connect NL to global markets and opportunities. The 2010 NL government Speech from the Throne refers to NL as a “Northern Gateway” that is “positioned to play a pivotal role in” among other things, “facilitating oil and natural gas development activities” [55] (p. 16). Indeed, in announcing a joint government-industry project in 2013, the throne speech stated that the project “will prepare us to fill key technological gaps in Arctic oil and gas development” [56] (p. 5). In a 2014 press release, one minister explains the government’s “efforts to enhance the province’s reputation as a real-world Arctic laboratory” and that NL is the perfect location “to develop new Arctic technologies” [57]. Thus, NL’s oil industry expansion is rationalized through narratives of technology and innovation.

Although the Premier’s introductory comments to Oceans of Opportunity note that “the market for ocean or blue technology-based solutions that help address such issues as climate change, energy, offshore industries, marine transportation, and defence is significant” [53] (p. ii), this brief acknowledgement of climate change is not further built upon. Thus, while more recent uses of the term blue economy (for instance, that of the High Level Panel) are typically associated with sustainability, this connection is limited in Oceans of Opportunity and certainly in how the province worked to situate itself as a facilitator of Arctic oil development. Thus, at the time, there was no apparent tension between NL’s blue economy and its oil economy.

4.2. Canada’s Evolving Ocean Economy

In the decade following the release of Oceans of Opportunity, a number of important social, economic, and political changes took place in NL, Canada, and around the world that introduced and solidified more recent global approaches to the blue economy. In particular, these included changes that more clearly articulated (and made unavoidable) the tension between expanding the oil economy and climate protection. First, there was increasing attention from governments and citizens worldwide on the need to address climate change, and thus the provincial government had to contend with regional, national, and global climate commitments as well as increasing social pressure. The 2015 Paris Agreement saw global leaders agree to keep global temperature rise to no more than 1.5 degrees. As part of this, Canada agreed to reduce GHG emissions to 30% below 2005 levels by 2030, with Prime Minister Trudeau later increasing this to 40–45% [58]. In 2016, Canada’s provinces and territories released the Pan-Canadian Framework on Clean Growth and Climate Change, which included initiatives such as putting a price on carbon. Also important was the passing of new impact assessment legislation, which came into effect in 2019 and required assessments to include an analysis of projects in terms of how they will help or hinder Canada’s Paris commitments. During this time, the concept of the blue economy also emerged in global governance spaces. As noted above, its use by small island nations as well as by larger ocean nations more broadly through the High Level Panel also took place at this time and thus helped to emphasize the ocean and ocean-based activities as environmentally and socially interconnected.

At the same time that climate change and the blue economy were moving into the political and social forefront in more pronounced ways, NL was experiencing economic problems associated with the 2014 oil price collapse. In November 2016, the newly elected Liberal government released a document, The Way Forward: A Vision for Sustainability and Growth for Newfoundland and Labrador, which was a long-term strategy meant to guide the province back to financial stability [59]. This document reinforced and reasserted the government’s commitment to oil as the future of its economy, stating that it planned to “position the province globally as a preferred location for oil and gas development” [59] (p. 22). It led to the release of the government’s long-term vision for the oil industry, Advance 2030, the overall goal of which is to double oil production by 2030 [60].

Clearly, neither the political-economic nor the social context would now support the previous framing of oil-industry technology as helping to facilitate oil expansion and particularly oil development in the Arctic. Despite this, however, the NL government has doubled down on the oil industry through its Advance 2030 agenda. Thus, the province is attempting to drastically increase oil production but at the same time has to contend with the broader context of Canada’s Paris climate commitments and its participation in the High Level Panel. Consequently, emerging at this time on both the Canadian and provincial level is an approach to offshore oil that puts it in direct relationship with renewable energy through technology in a way that leaves space for oil in Canada’s emerging blue economy.

4.3. Shifting Narratives: From Ocean to Blue Economy

In 2018, the government of NL embarked on a new initiative under The Way Forward plan that included aims to “position the province as a deep water centre of excellence,” expand the ocean technology and aerospace sectors, and look for “new opportunities for further economic growth from a global perspective” [61]. These aims of creating opportunities from the ocean, technology, and the global economy are nothing new in the province, as illustrated in the government strategies discussed above. In fact, these aspirations mirror the intent and language of other national and intergovernmental ocean development visions, including the High Level Panel [17] and the U.S. National Oceanic and Atmospheric Administration’s (NOAA) Blue Economy Strategic Plan [62]. Yet how ocean sectors in NL are positioned in relation to each other and to other regional and global industries has shifted in important ways in recent years, including ways that align more with conceptualizations of the blue economy emerging globally at the time—that is as a more integrated and sustainability-focused ocean economy rather than just a sum of separate industries (see, for example, [63]).

This new positioning is strikingly portrayed in a three-circle Venn diagram included in a report commissioned by the provincial government to help it enact this new initiative. The three overlapping circles represent oil and gas, fishing and aquaculture, and renewable energy. The overlapping segment in the center lists a variety of ocean technologies, thus suggesting the important mediating role that ocean technology can play in the expanding ocean economy [64] (p. 22). The argument is that some of the province’s “most economically important industries” including oil, fisheries, and aquaculture, “require new and common technological solutions to operate effectively in Newfoundland and Labrador’s challenging offshore conditions” [64] (p. 6). The diagram thus illustrates important connections and overlaps among all of these ocean industries. However, the overlap of oil with renewable energy, specifically through technology, has become an important part of recent ocean and blue economy discourse in the province and Canada and indeed, a key part of addressing the contradiction of oil in NL and Canada’s blue economy.

4.4. Resolving Regional Contradictions through Transitions: Three Overlapping Arguments

The expansion of oil is clearly a central focus of NL’s economic vision for the future. However, it is no longer socially or politically viable to promote oil industry expansion without addressing, at least rhetorically, the need to tackle the climate crisis. Due to the now widespread understanding of the need to curtail further offshore oil expansion, oil can no longer be framed in terms of links and crossovers to expanding offshore oil production in other locations, such as the Arctic. Thus, the previous justification for developing NL’s offshore oil no longer works. The more integrated and overlapping approach to the blue economy illustrated in the diagram referenced above offers a way to reconcile the contradiction between developing oil and addressing climate change in the province. It helps the provincial government justify its plans to expand the oil industry despite climate change. In particular, the province uses the language of transitions to situate NL as part of broader energy shifts that are happening around the world. Regional oil development and its associated technology and innovation are no longer framed as enabling the global oil industry, but rather as enabling global shifts away from oil. We see this transitions language employed in three different but overlapping arguments made by the government as well as industry actors.

The first is the “clean oil” argument, which has similarly been used in other oil-producing regions, such as Norway [65]. This argument is based on the relatively smaller amount of greenhouse gasses emitted from oil production in NL—much less than, for instance, the oil sands in Alberta, Canada. The clean oil argument asserts that, realistically, the world will continue to need oil for decades to come (even as we move toward renewable energy), and that as the world transitions away from oil, NL should be the place to supply that oil, given its lower environmental impact relative to other sources. In 2020, former NL Premier Dwight Ball argued that “As economies begin to reopen and global demand for petroleum products returns, we need to ensure that Canada remains a global energy leader, demonstrating that this demand can be met in a socially and environmentally sustainable manner” [66]. This argument has also been adopted and reinforced by industry associations. The NL Oil Industry Association (NOIA) stated that it “recognizes that as the world transitions to a lower-carbon economy, there is an important role for Canada’s offshore oil and gas industry to play” [67]. That is, NL’s “clean” oil is used to justify the continuation of the industry as the world (the rest of the world) transitions away from oil.

Second, and related to the clean oil argument, is the argument that NL’s oil is getting “cleaner” through the development and implementation of new technology. There has been a push recently to “decarbonize” the oil industry in the province, or to reduce the GHG emissions from the production of offshore oil. These emissions make up about 26% of the province’s total GHG emissions [68] and have been rising over the years as more projects come online. To reduce these emissions, research has been looking into new technology and opportunities to electrify offshore oil production, for instance, by installing offshore wind turbines or cables to bring power from onshore [69,70] or through carbon capture and storage [71]. This emphasis on technology, a common theme in blue economy initiatives worldwide [9,62], focuses attention on immediate and site-specific benefits, thus helping to imply that there are inherent sustainability benefits from technological advancements and implementation [72]. The “clean oil” and technology-focused decarbonization perspective is being pushed by industry in the province to justify oil and frame it as a solution rather than a contributor to the climate problem. Indeed, NOIA states that “If Canada is to achieve the emissions reductions targets set out in the Paris Agreement, we know that part of the solution is change within the oil and gas industry and a commitment to net-zero by 2050 helps set expectations and goals for all industries” [67]. Hence, the emphasis is on technology and how it can be developed and adopted to reduce GHG emissions in the production of oil in NL rather than transitioning away from oil.

Finally, the overlap between renewable energy and oil (through ocean technology) is used to justify the inclusion of oil in the blue economy by arguing that the technology developed for the oil industry can be transferred and used in renewable industries. The argument is that developing offshore oil will indirectly help renewable energy industries grow. Indeed, this is reflected in Canada’s blue economy engagement paper, which sees a role for the oil industry in the blue economy and specifically notes the role oil can play in “Canada’s transition to greener energy” [47] (p. 33). In fact, the paper states that the innovation that happens in the offshore oil industry may help with developing offshore wind [47] (p. 33). This effort to link oil with renewable energy is an important shift in how NL situates its oil industry in a global setting. While previously, technological advances and innovation in the oil industry were framed in terms of how they could facilitate oil development in other regions (such as the Arctic), now they are being framed for their ability to facilitate energy transitions. That is, the technology developed in the offshore oil industry is viewed for its potential contribution to expanding oil development regionally while simultaneously helping renewable industries expand. It is important to note, however, that offshore renewables, such as wind, are not being pursued in any significant way in NL. In fact, the province recently released a renewable energy plan that makes no mention of transitions away from oil. Rather, the plan suggests how renewable energy—in particular through the development of hydrogen technology—is an offshore opportunity “that can assist the oil and gas sector in reaching net-zero emissions” [73] (p. 5). Thus, the oil industry is part of the transition to renewables but not away from oil (and its problems) in NL. This is an important distinction as it leaves the provincial economy still dependent on an industry that it is simultaneously (and purportedly) helping to make obsolete. In doing so, the province remains in the realm of the oil-centred grey economy instead of on a path to a blue economy, which would involve moving away from oil and toward renewable energy and other sustainable ocean industries (see Figure 1).

4.5. Implications of a Blue Economy Framing of Oil

While the arguments justifying the continuation of NL’s oil industry and its inclusion in the province’s blue economy use the language of sustainability and energy transitions, they work primarily because the province is only responsible for GHG emissions within its own borders. Thus, it can only reduce GHG emissions from the production of its oil, which represents about 26% of provincial GHG emissions [68]. The province’s current approach to its blue economy, which focuses on technology and innovation, provides a solution for reducing these emissions and thus meeting regional and/or nation-based climate commitments. Indeed, the regional blue economy approach now emphasized suggests that there is no contradiction between the inclusion of oil in NL’s blue economy and climate commitments if GHG emissions from production can be reduced through technology. In fact, expanding the oil industry is often now framed positively by government and industry, as being part of the global energy solution. For instance, NL’s Premier attended the 2021 COP26 climate meetings in Glasgow where he pushed the “clean oil” narrative [74]. Consequently, and ironically, by focusing on reducing emissions from production regionally, expanding NL’s oil industry can actually be framed as contributing to Paris climate commitments, thus ostensibly eliminating the contradiction and tension between the oil economy and the blue economy.

As a result, there is a continuation of investment, incentives, subsidies, and other financial offerings aimed at expanding or supporting the oil industry. For instance, in 2021, the government announced a CAD 500 million package to the companies involved in the Terra Nova project, the province’s second field to produce oil starting in 2002 [75]. The package, which includes direct grants and a significant royalty payment reduction, was offered “to strengthen the economics of the Project and to support its continued operation” at a point in time when the project’s future was in question [76]. Similar but smaller grants were also given to two other currently producing projects to help them through financial trouble caused by global price declines and COVID-19 [77]. The Hibernia project received CAD 38 million [78] and the West White Rose project CAD 41.5 [79]. More broadly, the government implemented a new exploration initiative in 2020 that provides financial incentives for companies to drill more exploration wells off NL’s coast [80]. While these grants and initiatives were aimed at perpetuating and sustaining the oil industry (even when it is clearly financially struggling), other financial incentives have been more directly linked to the clean oil argument. For instance, the federal Offshore Emissions Reduction Fund provided CAD 75 million to “help Canada meet its environmental commitments, rebuild the economy, and create a lower carbon economy, especially towards reducing greenhouse gas emissions (GHGs)” [81]. In 2021, Natural Resources Canada also announced that it was providing CAD 24.4 million to 16 projects aimed at reducing GHG emissions in the provincial offshore industry [71]. While ostensibly these pots of money and funding are meant to help decarbonize NL’s offshore oil industry, they can also be viewed as subsidizing the carbon tax for the industry.

NL situates itself as part of global energy transitions, thus avoiding scrutiny for its role in contributing to the global climate problem. Even if regional innovations eliminated GHG emissions from oil production, there are still other problems associated with oil—especially from its consumption—most notably climate change and the uneven impacts it is having around the world. However, these issues are overlooked or ignored and not brought into regional blue economy planning. Consequently, NL’s regional blue economy does not align with Canada’s broader transformative blue economy promises. In fact, quite the opposite: the term blue economy is mobilized and employed in NL in a way that contributes to the maintenance of the status quo of an oil-dependent economy. Specifically, the blue economy narrative helps to address the contradiction that has become unavoidable since the previous decade—the contradiction of simultaneously expanding oil and taking climate change action. The environmental and social consequences of oil production and the responsibility for curtailing that production in the face of these consequences get pushed out of regional spaces, to be dealt with by other people in other places and times. Thus, NL’s regional blue economy approach and its clean oil argument and logic provides a “fix” to the tension of being a regional economy that simultaneously promotes oil and climate action. The problem, however, is that the fix will only ever be temporary, thus leaving both the climate and the provincial economy at risk. Furthermore, as noted above, other countries, such as Norway, are also using similar arguments to justify the expansion of offshore oil production. Given that we cannot continue to expand global oil production and still meet climate targets [1], these arguments clearly ignore a critical point that undermines their green claims.

4.6. A Just and Equitable Transition Away from Oil and toward a Blue Economy

We argue that blue economy planning should start from a vision of the future blue economy we want, one centered around oceans as environmentally and economically sustainable and socially equitable. Based on this vision, oil has no place in a fully realized blue economy. That being said, we recognize the reality that ocean economies have to transition to blue economies—that is, ocean economies that include oil have to transition away from it and/or toward renewables. Thus, we are more interested in the transition to an equitable blue economy that does not include oil and the work that has to be done to get there than we are in arguments about what should be in or out and what counts as a “blue economy.” Indeed, there is nothing automatic about just and equitable blue economies and implementing them takes long-term visions and planning that may, in places currently producing oil, require plans to wind down oil production. In other words, using blue economy language is fine as an aspiration for regional spaces that include oil; however, there has to be some kind of accountability and a plan to move away from it. We highlight three overlapping key components (see Figure 2) about the role of the oil industry in this transition to a blue economy and, more specifically, a just transition away from oil. This is not meant to be an exhaustive plan but rather a start to thinking through how we could include and take account of offshore oil in regions that want to transition to a blue economy that reflects the ambitions of now dominant high-level blue economy discourse and goals.

First, recent research shows that in order to meet current climate commitments, no new production of oil should take place [1]. Mitigating climate change impacts is not enough, and thus, there is a need to actually curtail the supply side [82], making supply-side policies critical [83]. Consequently, blue economies should be planned within the context of no further oil development. This will establish the broad policy context to transition toward a sustainable blue economy, including winding down any oil currently being produced. In this way, blue economy planning can focus on how other industries and activities might support the transition away from oil in order to build a future ocean that is equitable and sustainable. Several countries have recently stated that they will no longer issue offshore licenses for oil development activities. For instance, in 2021, Greenland changed its stance on developing offshore oil, stating that it would no longer issue exploration licenses. It cited “climate considerations, environmental considerations and economic common sense” as key motivations for the decision [84]. New Zealand made a similar announcement in 2018 when it stated that it would no longer issue offshore exploration licenses [85]. In 2020, Denmark also cancelled its current and future licensing rounds for oil exploration in the North Sea and established 2050 as the year that existing production would be completed. The Danish Minister for Climate, Energy and Utilities stated that “When the calendar reads 2050, the oil and gas valves will be turned off for good” [86]. More recently, at COP 26 in 2021, the Beyond Oil and Gas Alliance was launched publicly by Denmark and Costa Rica, with further members signing on, including France, Greenland, Ireland, Quebec, Sweden, and Wales as core members, and California, New Zealand, and Portugal as associate members [87]. Although perhaps only a symbolic gesture, the about-face in some regions is striking. For instance, just a decade ago, Greenland was arguing that it needed to develop its offshore resources in order to benefit economically and be more independent from Denmark [88].

Second, a just transition plan needs to be in place to guide actions away from oil and towards an equitable blue economy and to ensure that regional planning aligns with national and international goals and commitments. The decision not to further pursue oil will automatically lead to important changes in investments, political emphasis, and resource distribution. Consequently, within this context, planning for future economic activity and diversification would be easier and more certain as resources would not be put into expanding oil production. Indeed, when New Zealand announced its decision not to issue further exploration licenses offshore, Minister Woods stated that “Today we are providing certainty for industry and communities so they can plan for the future” [89]. A commitment to stop further exploration and production would also mean that any efforts to reduce GHG emissions from current oil production would lead to reductions on a global scale rather than just pushing responsibility to other regions where oil is consumed. Denmark, for instance, planned to look into electrifying existing oil production as part of its plan to wind down the oil industry [86] while also increasing efforts to develop offshore renewables, specifically wind [90]. Also critical in movements away from oil are transition plans, which help ensure that people and workers are not left behind in the transition and that alternative livelihoods, industries, and sources of revenue are created to sustain regional economies, people, and government programs. Part of the Danish Parliament’s agreement to wind down oil production was an emphasis on implementing just transitions and making sure that the approximately 4000 people working in the oil industry as well as the regions involved were not left behind [86]. New Zealand has also worked on a just transition plan with Taranaki, an area where the oil economy is important, and thus decisions about winding down oil activities will have significant impact. The broad “2050 roadmap” created was followed up by a specific “transition pathway action plan” that included specific actions around key themes, such as energy, to operationalize just transitions [91].

Finally, reviewing and reforming current subsidies to the oil industry would enable the development of alternative sustainable ocean industries and facilitate the transition to a sustainable blue economy. As noted above, NL’s economic development plans include expanding offshore oil; however, this perpetuates subsidies, grants, and incentives in order to fulfill this particular vision of the future. Subsidies help entrench narrow development pathways, for instance when large, subsidized infrastructure developments “must be” maintained in order to justify the initial investment—a circular argument that can lead to negative feedback loops. There is an increasing understanding of the need to get rid of fossil fuel subsidies to meet climate targets [92]. However, phasing out fossil fuels is challenging because of the significant role that the oil industry plays in many regional economies and fears about how revenue and employment will be replaced [93], thus highlighting the importance of simultaneous just transition planning.

Reforming subsidies is also challenging because they are administered at (and impact) multiple scales. For instance, the International Institute for Sustainable Development [27] estimates that 2019 federal fossil fuel subsidies in Canada were approximately CAD 600 million, although they also suggest that due to data gaps, this number is likely lower than the reality. They note that federal-level subsidies are only part of the picture and that the provincial level is also significant. Indeed, as illustrated above, oil industry subsidies in NL are coming from both federal and provincial governments. Furthermore, the impacts of fossil fuel production reach far beyond the regions of production (and benefits), affecting people and places all over the world who have no say in national and sub-national ocean governance. Yet there is movement on blue economy-related subsidy reform in international governance spaces, for instance in the marine fisheries industry, where nations have been working together to reform ecologically harmful subsidies to work toward United Nations Sustainable Development Goal 14, to “Conserve and sustainably use the oceans, seas and marine resources for sustainable development” [94]. In ocean economies that include oil, redirecting subsidies could support transitions to blue economies by supporting new ocean industries and development pathways. There has been some international discussion and movement toward reforming fossil fuel subsidies. At COP 26, 20 countries (including the US, UK, Denmark, and Canada) committed to no longer financing fossil fuel projects in other countries and instead putting the money toward greener projects. While the money diverted away from fossil fuel projects may be small compared to the subsidies the oil industry still gets, it is a symbolic step that may be indicative of shifting priorities worldwide.

5. Conclusions

Like many nations, Canada’s forthcoming blue economy strategy publicly aims to operationalize multilateral aspirations for sustainability and equity in the ocean. To be successful, however, regional blue economies cannot push environmental and social impacts elsewhere, to be dealt with in other places and times. Using a blue economy approach or language should, therefore, not be a way to justify business as usual, but rather to question it and plan for different—specifically more equitable and sustainable—futures. Indeed, planning and long-term thinking is critical for reaching blue economy aspirations globally and regionally. Our analysis has shown that the blue economy discourse recently adopted by the NL government is currently used to help justify the expansion of the offshore oil industry. This discourse revolves around technology and the overlaps between renewable and non-renewable ocean industries. Thus, the blue economy as envisioned and pursued in NL does not align with the goals and commitments made by Canada through the High Level Panel. Fundamental to this misalignment is that transitioning to renewables is not the same thing as transitioning away from oil. We argue that both Canada and NL’s blue economy planning should minimally include (1) a clear vision for a just and equitable blue economy based on renewable resources and diverse livelihoods, (2) a transition plan that does not expand oil and gas activity, and (3) plans to reform oil subsidies. These are fundamental and necessary aspects of just transitions away from oil and transitions to just and equitable blue economies.

This paper and our suggestions highlight the need to examine tensions and contradictions of blue economies in real spaces and to think about how these existing blue economies do and could better align with broader sustainability, climate, and equity goals for the ocean. In so doing, we contribute to increasing calls—both within and outside of academia—for more attention on how to conceptualize, plan, and operationalize more just and sustainable ocean spaces and economies. As Canada’s blue economy strategy develops and is put into action, future research will play an important role in monitoring and evaluating the extent to which the transition toward a blue economy is meeting broader climate and equity commitments and goals and how well implementation of the strategy fits within global just energy transitions. Such scrutiny can serve to hold accountable those that employ the language of blue economies and call into question whether it is being used simply as a tool of legitimation or as one of true change.