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Msg  50254 of 50261  at  9/11/2020 11:36:34 AM  by


Making Oil and Gas go the Long- and Wrong-Way Around is No Way to Deal with Pipeline Angst


Making Oil and Gas go the Long- and Wrong-Way Around is No Way to Deal with Pipeline Angst

Commentary, Energy, Ian Madsen

On July 2nd, 2020, a rather sad milestone or marker of Canada’s misplaced energy and environmental policies – not to mention its handling of federal-provincial relations – occurred. On that day, the first cargo of Western Canadian oil left Burrard Inlet on the Pacific coast for the 11,900 kilometre journey to the Irving oil refinery in Saint John, New Brunswick on the Atlantic coast.

It used to be that environmentalists were in strident opposition to any and all oil tanker traffic (and even some liquified natural gas, ‘LNG’, carriers) because of the potentially massive damage to marine life and ocean water quality that a breakage or major spill could cause. Now, they seem to prefer such transport to the much safer method of pipelines, where spills are quickly detected and usually ended and remediated quickly with little lasting damage to soil, waterways, or wildlife.

Shipping hundreds of thousands of barrels of oil through the Panama Canal nearly twelve thousand kilometres, which is almost as far as some far Eastern destinations from British Columbia, is certainly not what Cenovus, the seller of that first cargo, really wanted to do. The Energy East pipeline which TC Energy proposed, then cancelled in 2017, would have shipped the cargo less than half as far, at a lower cost, and in greater safety; but was opposed by some politicians in Quebec and by various groups that oppose fossil fuels of any sort being produced, shipped, sold, or consumed anywhere by anybody.

The federal government did not do anything to counter the opposition in Quebec, and by Indigenous groups, an opposition which may have been blunted and ended by more proactive negotiation and attention to legitimate safety or property rights concerns. There were also interprovincial and federal legal and constitutional questions which could have been addressed forcefully, with the preponderance of power appearing to be on the side of the project, much as the TransMountain pipeline expansion from Bruderheim (near Edmonton) to Burnaby (near Vancouver) went ahead, after much debate and legal battles, just this year. Much consultation and compromise occurred prior to construction.

If the environmentalists wanted to end oil production and export, they have failed, as the expensive tanker shipment shows. What they have done is made pipeline projects so difficult, delay-plagued, and expensive to build and complete via court actions, blockades, protests, and lobbying of green-pandering politicians, that few ever proceed; leaving much Alberta crude and bitumen in the ground, or sold at a heavy discount to US buyers, the only currently viable export possibility thus far.

It also leaves Canadian refineries and their domestic customers at the mercy of foreign oil producers, which now includes American ones and other nations which have more dubious environmental, social, or humanitarian standards; who, of course, get the full international price for their product, unlike their Canadian competitors. The opponents of pipelines in Quebec also now get tanker traffic to their refineries on the Saint Lawrence River, which, along with the risk of spills, also harms marine life.

The Keystone XL Express pipeline still has opposition in US courts which could make life difficult for Western Canadian producers, and the various fights over Enbridge’s Line 3 to Superior, Wisconsin, and its Line 5 under the Great Lakes still continue. This will make the Green lobby, and the green-industrial complex beneficiaries happy, but Canada is losing millions of dollars a day on the approximately two million barrels of oil and bitumen it exports every day, and foreign producers are reaping the benefits of this ongoing war, while Eastern consumers pay more and face the risks of tanker oil spills which pipelines would eliminate. Nobility and virtue for a few come at a high cost to many others.

Ian Madsen is a senior policy analyst with the Frontier Centre for Public Policy.

Photo by Dylan McLeod on Unsplash

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