Alberta Premier Danielle Smith says she believes she can convince B.C. to build a pipeline for Alberta crude.Jeff McIntosh/The Canadian Press
Alberta Premier Danielle Smith says her government is working with oil companies to try to secure a proposal for a new pipeline to the West Coast – and says she expects Prime Minister Mark Carney to “operate in good faith” on the pipeline issue.
The Alberta government has also pitched Mr. Carney on a kind of quid pro quo, in which oil companies commit to building the Pathways Alliance carbon-capture project if he greenlights an oil pipeline.
Oil and gas pipelines have come into sharp focus because of President Donald Trump’s trade war, as Canada’s fossil-fuel sector searches for more opportunities to diversify from the United States, its largest customer.
Mr. Carney has pledged to make Canada an energy superpower, but Ms. Smith says meeting that goal will require new pipelines that can transport Alberta oil and gas to a Canadian coast – west, north or east – to access overseas markets.
British Columbia’s Energy Minister, Adrian Dix, recently rejected the idea of a new pipeline in the province, citing the impracticality and massive costs associated with such a proposal.
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But Ms. Smith told the Global Energy Show in Calgary on Wednesday that she’s confident she can convince B.C. Premier David Eby of the merits of an oil pipeline.
“What I’ve heard them say recently is there’s no project – no project and no proponent. Well, that’s my job. There will be soon. We’re working very hard on being able to get industry players, private-sector players, to realize this time might be different,” she said.
If and when a company or consortium says it’s interested in building a pipeline, she said, Alberta would help it test out Mr. Carney’s promised two-year approval process for major infrastructure projects.
“We know that it’s a chicken-and-egg problem, that no one’s going to come forward with a project without some guarantee that it’s going to be approved,” she said. “The Prime Minister, I want to take him at his word that he wants to operate in good faith. So we’re going to operate in good faith.”
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The Premier’s ultimate goal is to get an oil pipeline onto a list of major infrastructure projects being developed by the federal government.
Ms. Smith said she also wants to see the Pathways Alliance carbon-capture project on that list – a 400-kilometre-long pipeline that would transport carbon captured at oil sands facilities to an underground hub near Cold Lake, Alta., aiming to reduce emissions by 22 megatonnes a year.
The project could cost anywhere from $10-billion to $20-billion – an amount that’s all expense, because there is no revenue associated with it, Ms. Smith said.
“But if you couple it with a million-barrel-per-day pipeline, that allows you $20-billion worth of revenue year after year after year for the lifetime of that project. All of a sudden, a $10-billion to $20-billion cost to decarbonize looks a lot more attractive when you have a new source of revenue.”
While she acknowledged some skepticism, Ms. Smith said she is hopeful that federal policies will be more helpful to the energy sector under Mr. Carney than under his predecessor, Justin Trudeau.
“The world has changed dramatically since Donald Trump got elected in November. I think that’s changed the national conversation, and I think [Mr. Carney] now has the ability to show leadership and be able to either substantially revise or completely eliminate some of those bad policies.”
Ms. Smith’s optimism about the Carney government echoed the voices of numerous chief executives during various panel discussions over the course of the Global Energy Show. However, they urged swift action from Ottawa – not just words.
Darlene Gates, CEO of MEG Energy Corp. MEG-T, said Ottawa now seems more open to substantive discussions around energy policy.
“Change is hard when we get a new federal government. But the excitement with change is it creates new opportunities. Some you’ll like, some you won’t, but the conversation is changing,” she said.
Mark Fitzgerald, CEO of Petronas Canada, said Mr. Carney’s vision to make Canada a clean and conventional energy superpower has already resonated all the way from shareholders into boardrooms. As a result, he said, more companies are talking about giving Canada another look.
For Chris Doornbos, CEO of E3 Lithium Ltd. ETL-X, attending roundtables with both Mr. Carney and federal Natural Resources Minister Tim Hodgson has given him optimism.
He said the discussions have been vastly different from those with the past three federal ministers.
“It was very tactical. It was very, ‘What are the problems and what are the solutions?’” Mr. Doornbos said. “It was, ‘Let’s get into it.’”