The Alberta oilsands will allow Canada to stand up to the U.S. on everything from Arctic sovereignty to rewriting NAFTA, Liberal leader Michael Ignatieff said Wednesday.

Ignatieff told a town hall meeting in a Gastown pub that Canadians are just starting to understand “how powerful the oilsands make us.”

He told an overflow audience crammed into the pub’s tiny back room that he toured the project in August.

“It is awe-inspiring,” he said, adding that the controversial project boasts enough oil to last the rest of this century.

“We’ve got oil reserves there that are just staggering in size. It changes everything about our economic future. It changes everything about Canada’s importance in the world.”

Ignatieff’s comments came in response to a question from a woman in the audience, who used the term “tarsands” – a description used by opponents of the project.

“This is where a chill falls over the room because everybody expects me to say they’re terrible and shut them down,” said Ignatieff. “Absolutely not.”

Using the term “oilsands” – the description preferred by the industry – Ignatieff said the oil will allow Canada to stand up to incoming U.S. president Barack Obama.

“But the challenge is it’s dirty and we’ve got to clean it up,” he added.

Aboriginal health issues in Fort Chipewyan must be addressed, he said, adding that the lack of transportation, housing and sewage in Fort McMurray is a scandal.

Ignatieff added that Liberals must avoid upsetting Albertans.

“Energy policy in our country is a national unity issue,” he said. “The dumbest thing you can do – and no Liberal must ever do it – is run against Alberta, make Alberta the enemy, isolate Alberta.”

Ignatieff told the meeting, organized by the B.C. Young Liberals, that former Liberal leader Stéphane Dion’s Green Shift platform “killed” the party in last October’s federal election.

“Let’s be honest,” he said. “We got killed at the doorstep with the Green Shift.”

Ignatieff praised Dion for “putting environmental sustainability at the centre of what this party stands for.”

But Dion’s “experiment in putting a price on carbon” through a carbon tax angered voters, Ignatieff said.

“What happened was, everybody who ran a tractor, everybody who ran a boat, everybody who drove a truck for a living said, ‘There’s only one thing I understand about this – you’ve just added to my cost of living.’ ”

The Liberal party has to convince voters that becoming more energy efficient will make them more economically competitive, he said.

The party needs to tell workers “Your job depends on being energy efficient and as green as we can get you to be,” Ignatieff said.

Tom Barrett is a contributing editor at The Tyee.