The path already taken might be the easiest way to get a new oil pipeline built from Alberta through British Columbia to Canada’s Pacific Coast.
That’s what Prime Minister Mark Carney and Alberta Premier Danielle Smith are betting on as they announced a proposal for a new pipeline to follow the route near the Trans Mountain and Trans Mountain Expansion (TMX) pipelines to BC’s Lower Mainland. So let’s call it TMXL.
After months of speculation, rumours, and political jostling over the proposed route of the new pipeline — Smith’s government is believed to have preferred the much more politically fraught northern route to Kitimat or Prince Rupert — the southern proposal was announced in Calgary by Carney and Smith.
The pipeline announcement comes days after Carney visited BC Premier David Eby to announce a new Memorandum of Understanding that reaffirms the North Coast tanker ban and includes $3 billion in federal funding to replace the aging Massey Tunnel and other investments — smoothing over any expected opposition from the NDP government on the Left Coast.
It also coincides with the start of Calgary Stampede, one of the largest events and networking opportunities in Canada’s political calendar. Dozens of Liberal MPs and cabinet ministers are expected to descend upon the city over the next two weeks at the encouragement of Calgary Confederation MP Corey Hogan, the city’s sole Liberal MP.
The estimated cost of the TMXL project, according to the Alberta government's submission to the Major Projects Office, would be $35.2 billion to $43.7 billion.
Governments desperate to get pipelines built have already proven they will spend billions in public dollars to make it happen so there is little incentive for private corporations to jump to cover the costs (and I’m sure Smith’s separation referendum isn’t helping).
The Alberta government’s submission to the Major Projects Office proposes the Alberta Petroleum Marketing Commission and Trans Mountain Corporation lead the design, development, permitting, construction and operation of the TMXL pipeline.
The Alberta Petroleum Marketing Commission is a public agency of Alberta government and the Trans Mountain Corporation is a federal crown corporation. The submission names publicly traded company Pembina Pipeline as a “strategic advisor” for the pipeline project.
The TMXL pipeline was described as a public-private partnership, but it’s almost certain that the public will end up being the biggest investor in this project.
The pipeline debate has taken up a lot of oxygen in Alberta politics and it is clear that Smith wants to have this pipeline project underway before a possible provincial election in October 2027.
Peter Nicholson shared some thoughts about the pipeline in anticipation of this announcement. Nicholson is a former Deputy Chief of Staff for Policy in the Office of the Prime Minister of Canada and currently serves as Chair of the Board of the Canadian Climate Institute.
Alberta NDP leader Naheed Nenshi:
“Today’s news is welcome.
“Alberta needs pipelines to safely get our product to markets in Asia. Alberta’s NDP has long advocated for a southern pipeline route while the UCP wasted time and money on a non-feasible Northern route. We are very pleased to see the southern line progress.
“We are also pleased to see progress on Pathways after so many years. It’s a critical step to future-proof our oil sands production.
“Canada works best when we work together and we are pleased the federal government is working to get projects done even as Danielle Smith actively tries to undermine the country with her referendum on separation.”
Pembina Institute executive director Chris Severson-Baker:
“After months of speculation, it is now clear: there is no business case for a new west coast pipeline in Canada. If this was a smart economic venture; if there was any kind of reasonable return on investment to be made, a private company or companies would have put up the cash. Instead, Albertan and Canadian taxpayers will now shoulder the cost of 90% of this project – which will likely run into the tens of billions of dollars. Let there be no doubt: the Trans Mountain Corporation and the Alberta Marketing Petroleum Commission are not private proponents. They are wholly taxpayer-funded Crown Corporations.
“Clearly, this is not what either Premier Smith or Prime Minister Carney promised Canadians. Since last summer, both have repeatedly said a pipeline will only move forward if a private company paid for it. Indeed, both went to great lengths to induce a private company to do so. In Alberta’s case, this has so far included the unprecedented steps of taking barrels of oil as ‘in-kind’ payments from oilsands companies (as opposed to cash royalties); providing the Alberta Petroleum Marketing Commission a loan of almost a billion dollars to go to Asia in search of buyers for those barrels; and finally contemplating using Albertans’ tax dollars to retool refineries in Japan to process the oilsands’ variety of heavy crude. These are all examples of Alberta taxpayer dollars and royalty revenue being used to artificially create market demand for Alberta’s oil, instead of being spent on vital public services. Still, none of it worked to get a private proponent to lead this project.
Calgary Chamber of Commerce President & CEO Deborah Yedlin:
“The Calgary Chamber of Commerce welcomes today’s announcement of a plan for a new Alberta pipeline to the west coast, in partnership with Trans Mountain and Pembina Pipeline Corporation, along with the final agreement on the terms of the Pathways project. We commend the federal and provincial governments for their ongoing collaboration to advance projects and build Canadian prosperity.
“Amid geopolitical uncertainty, Canada has a once-in-a-generation opportunity to strengthen its economic future by advancing critical energy infrastructure, and the proposed southern route will help accelerate pipeline construction by reducing regulatory barriers. Alberta – and Canada – have a critical role to play in supplying the energy the world needs, and this marks a significant step toward fulfilling that responsibility and becoming an energy superpower. By leveraging Trans Mountain’s existing route, this is both an expeditious and pragmatic approach that will generate significant economic growth for the province and the country.
“Today’s announcement shows what this federal government will protect above all else: the profits of Big Oil.
As we mark the five-year anniversary of a heat dome that killed 619 people in British Columbia – and as many communities across the country are facing extreme weather right now – Canadians deserve leadership that protects us. Instead, this government is doubling down on yesterday’s failed solutions and dragging us into further danger, risk and insecurity.
The opaque and confusing public-private partnership ownership structure means it’s very likely that we, the public, will not only bear the risks and the damages, but also the lion’s share of the costs.
Thank you for reading and subscribing to Daveberta. There is never a dull moment in Alberta politics and it’s always a pleasure to share my thoughts about what’s happening in my corner of Canada with more than 9,000 Daveberta subscribers.
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I’m taking a short break from writing over the next week to enjoy the summer weather as much as possible (and the break in the rain in Edmonton!). I will be back with new columns in mid-July.
Thanks again,
Dave
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