THE U.S. CANNOT BE ENERGY SECURE WITHOUT CANADA.

response equipment.

The groups also advocated for looser restrictions on rules of origin for oil imports.

Currently, for example, some Canadian oil exports to the U.S. and Mexico, if mixed with a thinning agent called diluent that allows bitumen to flow through a pipeline, have been slapped with duties because buyers cannot verify that the product originated in a NAFTA country. As a result, Canadian oilsands producers have in recent years been forced to import higher volumes of diluent from the U.S. to mobilize their heavy crude as bitumen production in northern Alberta continues to climb.

The groups also advocated for provisions allowing for the unrestricted flow of data between countries.

The Canadian and U.S. energy sectors in particular are highly dependent on one another. A recent report by the Canadian Energy Research Institute estimates the total capital investment and revenues from operations over the next 11 years will generate $2.7 trillion in GDP in Canada and US$45.6 billion in the U.S. or hasten the regulatory process around major infrastructure projects.

The agreement followed an earlier document in 2007, published by the Council of the Federation, that was similarly long on ambition and short on detail.

Seeing that Canada has failed to integrate its energy markets, a continental strategy seems even more unlikely — particularly since Trump and Prime Minister Justin Trudeau sharply diverge on environmental policy.

And yet, some are calling on Canada to use NAFTA negotiations to interlock the three countries’ physical energy systems and establish itself as a leader on climate policy.

“I think we can use the NAFTA negotiation table to put a stake in the ground on aligning environmental policy,” said Senator Doug Black, who founded the Energy Policy Institute of Canada, which focuses on energy market integration.

“It’s in Canada’s clear interest to do that, because we are now offside on where President Trump wants to go, and the result of that adds to the competitive burden that Canadian business is incurring month after month after month.”

Mexico is seen as a critical wild card in energy negotiations. Analysts say the three countries are particularly eager to formalize the liberalization of Mexico’s energy industry, which in mid-2014 opened up large blocks of onshore and offshore oil and gas leases to foreign investors.

The changes, introduced by President Enrique Pena Nieto, created billions of dollars in foreign direct investment. U.S. and European energy companies, including Royal Dutch Shell PLC, Statoil ASA and Chevron Corp., were among the top bidders.

Several U.S. pipeline companies, along with Calgary’s TransCanada Corp., have been building natural gas pipelines in Mexico as it expands output. And General Electric Co., among others, is selling natural gas generators to Mexican buyers as the country modernizes its electricity grid.

Negotiators are keen to bring some level of permanence to Mexico’s new-found openness to foreign investment, but some believe it could be threatened by leftleaning opposition leader Andres Manuel Lopez Obrador, who objects to economic liberalization. He leads several public polls ahead of the country’s presidential election next year.

“One could rewrite NAFTA to put a firmer foundation in place to keep those markets open,” said Alan Krupnick, a senior fellow at the RFF Center for Energy and Climate Economics in Washington.

Krupnick and others also see opportunities for improved trade ties in electricity generation, particularly along the Mexico-U.S. border but also between the U.S. and Canada.

Expanding existing power generation and creating new power corridors could be part of a broader plan to map out a fully integrated electricity grid, RFF researchers said in a 2016 report.

But even if NAFTA members eventually agree to improve the most obvious faults within the agreement, the countries are a long way off of a true North American energy strategy. Nevertheless, Canada can take solace that its sector will remain deeply relevant to Trump’s central energy ambition: achieving energy security.

“The U.S. cannot be energy secure without Canada,” Sen. Black said. “In order to achieve President Trump’s goals, Canada is essential.”