(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

North Okanagan-Shuswap fundraiser delivers for charities

Armstrong Regional Cooperative’s Fuel Good Day raises $10,000 in Vernon, Armstrong and Salmon Arm

Salmon Arm landfill accepts used oil and anti-freeze for recycling

Partnership with Oil Management Association opens recycling opportunities

Algae in Salmon Arm Bay dissipates

Testing by Interior Health indicates low levels to no toxins in the algae

Candidates begin run for a seat in the Shuswap

Races will take place in Salmon Arm, School District #83 and CSRD

Couple plans to live sustainable dream in Malakwa

The plan includes building a small zero-waste home at Cedars RV Park

Your morning news in 90: Sept. 20, 2018

Tune in for 90 seconds to get the top headlines for the Okanagan, Shuswap and Similkameen.

The longest week: Carolinas worn out by Florence

Frustration and sheer exhaustion are building as thousands of people wait to go home seven days after the storm began battering the coast.

Vancouver councillors move ahead with policy for duplexes on detached home lots

Mayor Gregor Robertson says the decision is another step toward adding homes in the city for the so-called “missing middle.”

Canada’s goal is to play in a medal game at World Cup in Spain

The 2014 women’s world basketball championships were a coming out party for Canada.

World Anti-Doping Agency reinstates Russia

There was no mention of Russia publicly accepting a state-sponsored conspiracy to help its athletes win Olympic medals by doping.

Nanaimo’s Tilray pot stock continues rising, firm now worth more than $21 billion US

The B.C. company’s shares have risen more than 1,000 % since its initial public offering in July

Fresh-faced Flames fend off Canucks 4-1

Vancouver drops second straight NHL exhibition contest

VIDEO: B.C. deer struggles with life-preserver caught in antlers

Campbell River resident captures entangled deer on camera

Most Read