CALGARY — It’s quite a needle that the prime minister has threaded, weaving together announcements with B.C., Alberta, and private industry to move forward with a new million-barrel-a-day pipeline to Canada’s West Coast.
It’s taken a long time to get to this point, though, and we’re still really only nearing the end of the beginning. It’s unfortunate that it took months of negotiations, major concessions, and an unprecedented legislative intervention to expedite Canada’s regulatory approval process just to arrive at what is essentially the lowest-hanging fruit.
It would be a terrible indictment of Canada’s ability to build major projects if all of this was somehow insufficient to move this project forward. By landing on the easiest, simplest pipeline route with the least possible amount of opposition, there should be zero excuses now
Rather than a pipeline project to a deepwater port in northwestern B.C. — the shortest distance from Canada to Asia — Alberta has settled on a route to the southwest coast. This will hew more or less to the right-of-way of the existing Trans Mountain expansion (TMX), ending at Roberts Bank port terminal in Delta, B.C.
The Thursday evening announcement in Calgary was the culmination of a rather busy and consequential day for Mark Carney. The prime minister started the day in Vancouver, where he announced a new agreement with B.C. Premier David Eby.
Essentially, B.C. won’t fight this new pipeline and, in exchange, will receive considerable benefits in the form of billions for resource projects and major infrastructure investments. Ottawa will also maintain the tanker ban along B.C.’s northern coast — a major political concession in B.C.’s favour.
To be sure, further growing our capacity to develop and export LNG to Asian markets is a win-win for B.C. and for Canada. Still, the upside for B.C. is considerable — including the benefits that this pipeline will deliver.
The tanker ban itself was always redundant and symbolic, at least based on the Liberals’ underlying logic in favour of the Impact Assessment Act. Canada’s coastline far exceeds just the B.C. north coast, and the whole point of raising the bar on environmental impact assessment was to better protect sensitive areas.
Keeping the tanker ban, therefore, constitutes yet another concession from Alberta, since the original Alberta-Ottawa MOU left the door open to adjusting the ban, if necessary, to accommodate a pipeline project. There would surely have been considerable opposition to such a project, however..
So yes, Alberta gets federal backing, and referral to the Major Projects Office, of a new pipeline and the fruits of Carney’s efforts to facilitate a more conducive political atmosphere.
There was also Ottawa’s concession to ease the controversial Clean Electricity Regulations. That helped pave the path for Thursday’s other big announcement of a $4.6-billion natural gas project to power a new data centre near Edmonton
And, of course, Alberta will benefit tremendously from the additional production capacity that will fill the new pipeline and be shipped off to foreign markets.
But we cannot overlook the costs that fall on the province.
There will be costs associated with the development of the Pathways carbon capture and storage project. The full costs are not yet known, and the major oilsands companies will be partners in that project, but this a condition for federal support. The same is true of the escalating industrial carbon price, although a recent compromise agreement will keep it from reaching its originally planned high level.
And there’s also the cost of building this pipeline. Although we can expect this project, once completed, to deliver substantial revenues, there’s still the price tag of construction. It’s estimated that this pipeline will cost upwards of $35-billion to build, and the private sector has still been skittish about the risks of such an investment. In the meantime, taxpayer dollars will be in the mix.
So far, there is only one private sector partner, the Pembina Pipeline Corporation, as the others involved — Trans Mountain Corp. and the Alberta Petroleum Marketing Commission — are Crown entities. Ideally, there would be more private involvement and hopefully greater certainty as this project moves forward can attract more investment.
Still, as the prime minister pointed out, we’re unleashing at least $200-billion in new investments across all of these projects. Premier Smith called it “transformational wealth,” constituting “an opportunity neither Canada nor Alberta can afford to leave unrealized.”
Hopefully this now marks the end of the MOUs and trade-offs. We still need to see a quick decision from Ottawa with regard to designating this project to be in the national interest. The lack of such a designation in the entire first year of the Building Canada Act has not helped to build confidence in the notion that the federal government is determined to act with urgency on major projects.
The prime minister and premier deserve credit for moving the ball forward on such an important initiative. The changing and growing global economic pressures we’re facing make this urgent, and the benefits we’re now realizing from TMX show that it will be worth it.
And beyond just enhancing Canada’s prosperity and economic security, this comes at an important political moment for Alberta.
It’s an arduous and imperfect path that’s finally brought us to a good news announcement. So no more concessions, no more MOUs. Let’s get this done. If not now, when?
Rob Breakenridge is a Calgary-based podcaster and writer. He can be found at robbreakenridge.ca and reached at rob.breakenridge@gmail.com