Canada’s resource riches have been an important part of its investment story over the past decade. But you wouldn’t always know it from the way the country’s politicians, regulators and local stakeholders treat the oil and gas industry.

Cynics might argue that the perennial foot-dragging on the part of these constituencies is just another way of extracting maximum concessions from energy producers. Indeed, over the years, we’ve watched some projects receive approval from the government, albeit with hundreds of seemingly onerous conditions attached.

The fact that companies are willing to accede to such demands suggests that when times are good, there is enough money to go around for everyone to get their payday without destroying the economics of a pipeline or liquefied natural gas (LNG) export facility.

But timing is key.

Since the late 1990s, the energy sector has gone from boom to bust about every five years or so. This creates a mismatch with the life cycle of energy infrastructure projects, which can take a decade or longer to go from the planning stages to commencing operations.

This mismatch is further compounded by the ultra-long-term nature of some contracts — LNG contracts, for instance, typically have a duration of 25 years. As such, there can be a very narrow window during which investing in such projects will prove profitable.

The energy sector’s latest bust offers a perfect illustration of how Canada’s policymakers took the energy boom for granted.

Federal and provincial governments had high hopes for the buildout of LNG export infrastructure along the British Columbia coast. But they repeatedly deferred crucial approvals in what turned into a comically drawn-out review process for some of the world’s biggest energy companies.

Only when the slide in energy prices started gathering momentum did Canadian policymakers finally show any sense of urgency.

Unfortunately, with the long-term economics of such projects in doubt, now it’s the energy sector’s turn to drag its heels. In the case of LNG, to date none of the more than a dozen multi-billion-dollar export projects have received final investment decisions.

With energy prices expected to be lower for longer, politicians’ shortsightedness could have lasting implications for Canada’s gas sector.

Canada is the world’s fifth-largest producer of natural gas, with annual production of 14.9 billion cubic feet per day in 2015, of which roughly half was exported to the U.S. The country’s potential resources equate to more than 300 years of consumption at current demand levels.

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However, Canada has a very basic problem: an utter lack of diversification among export markets. Expectations have recently dwindled to just one or two LNG export facilities getting off the ground, leaving the U.S. as the main destination for the country’s surplus gas.

That wasn’t a big problem prior to the Shale Revolution, when Canadian gas accounted for 16% of the U.S. market. But dirt-cheap gas is now available from a number of U.S. shale plays, particularly the prolific Marcellus Shale formation.

The abundance of shale gas is not only starting to crowd out Canadian gas from key U.S. markets — exports of Canadian gas to the U.S. have dropped 16% over the past five years and are expected to fall even further — but have also created a perverse situation where Canada’s gas producers are competing domestically against their American counterparts.

The Marcellus, which spans from West Virginia to upstate New York, is only 400 miles away from high-demand markets in Eastern Canada, particularly Toronto. By comparison, most of Canada’s natural gas production takes place in Western Canada, about 2,400 miles away.

Consequently, a number of pipeline companies are looking to take advantage of the Marcellus’ proximity to Ontario, including Energy Transfer Partners LP (NYSE: ETP) and Spectra Energy Corp. (NYSE: SE).

To some extent, Canada has already ceded the Ontario gas market to the U.S., with about 60% of provincial gas demand satisfied by U.S. imports. Eastern gas demand averages about 3 billion cubic feet per day, or roughly 20% of the country’s total production, so the stakes are high.

To win back market share and counter ETP and Spectra, TransCanada Corp. (NYSE: TRP, TSX: TRP) has offered to cut its tolls by 40% to 50% for Canadian producers in order to move gas east and beat the Marcellus players to market.

That brings us to another perverse situation created by the intransigence of Canada’s policymakers. TransCanada’s chief rival, fellow Canadian pipeline giant Enbridge Inc. (NYSE: ENB, TSX: ENB), has seen a handful of major projects stymied in recent years.

Consequently, the company decided to buy its energy infrastructure readymade and last week announced that it had agreed to acquire U.S.-based Spectra for US$42.8 billion, including the assumption of debt. Assuming the deal is consummated, that essentially pits an Enbridge-backed Spectra against TransCanada for control of Eastern Canada’s gas market.

At the same time, TransCanada, which has suffered its own setbacks at the hands of both U.S. and Canadian policymakers, also has a significant footprint in the Marcellus courtesy of its recent acquisition of Columbia Pipeline Group, which closed on July 1.

If steep discounts aren’t enough to make eastbound gas economic for Canadian energy producers, then they could lose even more market share, which would lead to further production cuts. Pipeline capacity is often booked under long-term contracts, which means producers could get shut out of Eastern Canada’s gas market for at least 10 years.

“This is absolutely critical for Canadian producers,” Gas Processing Management Inc. associate Ed Kallio told the Financial Post. With the absence of LNG exports and the loss of a key domestic market, “drill bits will stop turning here,” he said.

Of course, when it comes to transporting gas to Toronto, TransCanada has a big thing going for it that its would-be competitors do not, especially considering this age of rampant NIMBYism: It’s already got the pipes in the ground.