The Road to Hell

Will Alberta and Ottawa find a new path for energy exports?

Time for the Takeaway, and where good intentions get you. The recent memorandum of understanding between the province of Alberta and the federal government has been hailed as an important step in reclaiming a relationship that has in recent years been badly stressed.

The intention seems clear: in exchange for some concessions by Alberta on meeting carbon pricing commitments, the feds will throw their support behind Big Energy Projects. Front and centre on the list of Big Energy Projects is a new pipeline, to satisfy the long-held desire to ship a higher volume of Alberta’s abundant oil to markets, especially markets in Asia.

Anyone with a vague recollection of the Northern Gateway debate might be feeling a vague sense of unease right now. That was the pipeline Enbridge tried to build 15 years ago after a MOU opened the door to the concept. What followed was years of pushback - from First Nations, environmentalists and ultimately from governments who read the room of public opinion.

Is the MOU signed last week different? Times have changed, yes, and in general the spirit in Canada is tilted back toward a view that we should capitalize on our resources, rather than apologize for them. But for the private capital the federal government insists must be along for any pipeline ride, that history represents a very real risk.

Attitudes around the sector and its exports were also pretty positive in 2010, when Gateway was being debated. And even then, concerns about the pristine and complex environment of BCs north coast proved insurmountable. Might the federal government overrule a tanker ban unofficially in place since the 1970s? Maybe. But it seems more likely that interests will be redirected towards expanding existing southern BC routes. That might be a more practical approach, if less ambitious.

My takeaway? There was a lot of symbolism in the warmed up tone between Alberta and the feds. It remains to be seen if it was ONLY symbolism.