(The Canadian Press files.)

Lack of pipelines costing Canada billions: study

A new report by the Fraser Institute suggests Canada could miss out on $15.8 billion this year

Canada is losing out on $16 billion in potential revenue because of a shortage of oil pipelines, according to the latest study by the Fraser Institute think tank.

The study, released Tuesday, highlights how much money the country is losing through several “costly constraints” that have led to overdependence on the U.S., as well as reliance on more costly modes of energy transportation, such as rail.

“Insufficient transportation infrastructure and pipeline bottlenecks” have led to a dramatic drop in the market price of Canadian crude oil compared to other oil prices, the report said.

The difference in price between Western Canada Select and West Texas Intermediate averaged US$26.30 per barrel in 2018.

If this continues beyond the year’s first quarter, the report said, national energy firms could miss out on $15.8 billion in revenue, or about 0.7 per cent of Canada’s national GDP. That’s compared to a loss of $20.7 billion in foregone revenue between 2013 and 2017.

“Canada’s steep oil price discount is a result of insufficient pipeline capacity, which has dramatically lowered the market price for Canadian crude oil and resulted in lost revenue for oil producers as well as the economy,” the report says.

Trans Mountain key to Asian markets: study

Nearly 99 per cent of Canadian heavy crude oil is currently exported to the U.S., the study said, so expanding the B.C.-to-Alberta Trans Mountain pipeline would help gain access to Asian markets.

Building the Keystone XL and the Line 3 Replacement pipelines, it added, would expand capacity to the U.S. to combat a growing energy sector south of the border.

Canada doesn’t have the inventory to sell oil overseas because of delays and political opposition to several pipelines, the report said, and energy companies are forced to sell barrels to the U.S. at lower prices.

“Canada requires new pipeline infrastructure to transport heavy crude production from Western Canada to Gulf Coast refining hubs and overseas markets,” the report says.

B.C., feds continue court battle

Exactly which level of government has jurisdiction over the trans-provincial pipeline is currently before the courts.

The B.C. government has applied to court to see if it can impose new environmental permits on the pipeline project.

Prime Minister Justin Trudeau has vowed the pipeline will be built, and federal Finance Minister Bill Morneau is working on a plan with Kinder Morgan to ease investors’ worries.

B.C. Premier John Horgan, meanwhile, has said he will use every tool available to stop the pipeline, which he says could have environmental and economic repercussions in the case of the spill.


@ashwadhwani
ashley.wadhwani@bpdigital.ca

Like us on Facebook and follow us on Twitter.

Cost of Pipeline Constraints in Canada: Fraser Institute by Ashley Wadhwani on Scribd

Just Posted

FEATURE FRIDAY: Preserving Kelowna’s history, one tombstone at a time

The Kelowna Museum Society to host a workshop to clean headstones

Record cherry crop anticipated

BC Tree Fruit growers expecting crop of 12 million pounds due to ideal conditions

Declining mule deer tracked in new study

Wildlife research collaborators join forces on research initiative

B.C. Interior flood risk diminishing

Snowmelt receding but rainfall impact remains a concern

Plea to help find missing dog in Kelowna

Willow has been missing since Sunday near Dee Lake Resort

Black Press Media to launch Pipeline Full of Controversy series

Series covers Trans Mountain’s history, science, Indigenous reaction, politics and economics

Abbotsford high school teacher charged with sexual offences involving two youths

Henry Kang, 50, charged with two counts each sex assault and sexual exploitation

Toronto Raptors star to hold basketball camp in B.C.

DeMar DeRozan is hosting a four-day camp for players aged 6-16 at the University of Victoria

More boat launches shut down as Shuswap Lake rises

Municipalities warn other boat launches could be closed down with little advance warning

Military college students accused of violating Qur’an with bacon

Alleged acts by four cadets from the Royal Military College in Quebec caught on video

Canucks sign top prospect Elias Pettersson to entry-level deal

Slick centre drafted No. 5 overall in 2017 NHL draft

Wildfire northwest of Kamloops jumps to 1,600 hectares overnight

Ground crews and aircraft are responding to an estimated 1,600 hectare wildfire approximately 55 kilometers northwest of Kamloops, near the Deadman Vidette Road.

Former B.C. police chief dies in ATV accident

Ex-Nelson top cop began his career in Vancouver

Referendum in Ireland would repeal strict ban on abortion

Voters throughout Ireland have begun casting votes in a referendum that may lead to a loosening of the country’s strict ban on most abortions.

Most Read