Prime Minister Trudeau’s approval last week of Kinder Morgan’s Trans Mountain pipeline to B.C.’s coast and Enbridge’s Line 3 replacement to the United States came as welcomed news for Alberta’s oil patch, which has been reeling from job losses and depressed commodity prices. Should the pipelines eventually be constructed, they will help Canadians get closer to full value for their resources.

While the approval of two new pipelines is certainly a positive step, the approvals come at a time when potential oil and gas investors are finding much of Canada, and in particular Alberta, less attractive for investment.

How do we know this? Every year for almost a decade the Fraser Institute’s Global Petroleum Survey has tapped the perceptions of investors and measured how various policies (royalties and taxes, duplicative regulations, infrastructure, etc.) might attract or deter investment in jurisdictions worldwide.

This year, Alberta, the heart and soul of oil and gas production in Canada, saw its global ranking in the survey deteriorate for the second straight year. In 2014, Alberta ranked as the 14th most attractive jurisdiction in the world for oil and gas investment. By 2015, Alberta dropped to 25th and this year ranks a lowly 43rd, putting behind British Columbia for the first time.

Alberta’s decline in the eyes of investors shouldn’t be surprising. In the past year-and-a-half, the Alberta government has increased both corporate and personal income taxes, introduced a carbon tax, and will implement a cap on emissions from oilsands production.

The cap on emissions alone has the potential to result in lost production totalling more than $100 billion, as the cap would keep some oil in the ground. Which begs the question: Why would investors put their money into Alberta as opposed to somewhere else, if they possibly can’t produce all the oil the market is willing to bear?

Policy changes breed uncertainty. For example, in 2014, 38 per cent of survey respondents for Alberta found that uncertainty surrounding environmental regulations was a deterrent to investment. In 2016, this number jumped to 72 per cent.

Alberta also saw a higher percentage of respondents indicate that taxation and the uncertainty resulting from regulatory duplication and inconsistencies were deterrents to investment.

While Alberta becomes less attractive to investment, Saskatchewan continues to shine. This year Alberta’s neighbour to the east rose in the rankings to fourth most attractive jurisdiction in the world for investment, as oil and gas companies view the province as being much more stable and certain.

Alberta also faces stiff competition from American jurisdictions including Oklahoma, Texas and North Dakota, all of which ranked in the global top 10.

Alberta’s continuing decline in the eyes of investors should be cause for concern. Although the province has some of the world’s largest petroleum reserves, Alberta is now surrounded in every direction but north by states and provinces that, in the eyes of investors, are more attractive places to put their next dollar.