A new plan to construct a pipeline transporting one million barrels of oil daily from Alberta to the B.C. coast has been named the Pacific Link pipeline and is now considered a project of national interest, as announced jointly by the federal and Alberta governments. The pipeline has been included in Schedule 1 of the Building Canada Act, signifying a shift from deliberating its necessity to focusing on the streamlined and expedited approval process, including environmental evaluations.
Formerly, project developers faced prolonged delays and substantial costs upfront without clarity on federal support, which deterred many from proceeding. With the revised approach, the government aims to provide a clear stance at the project’s onset to encourage development.
An official disclosed that the pipeline is anticipated to contribute up to $30 billion annually to Canada’s GDP, with $20 billion stemming directly from the pipeline operation. By broadening export destinations beyond the U.S., Canada can potentially fetch higher prices for its oil, potentially generating an additional $10 billion annually. Additionally, the construction and operation of the project could generate up to 140,000 job opportunities.
The project’s estimated price tag ranges between $35.2 billion and $43.7 billion, encompassing a contingency fund. The ownership structure involves the Alberta government and the federally owned Trans Mountain Corporation each holding a 45% stake, with the Pembina Pipeline Corporation from Calgary possessing a 10% share during the construction phase. Post-completion, Pembina may acquire an additional 10% interest, while Indigenous communities will be offered a minimum 10% ownership.
Despite the predominant government ownership, private sector involvement is anticipated, with potential investors monitoring the project’s progress towards the targeted operational timeline of 2032-33. The Alberta Premier expressed that governmental participation in this initiative aims to instill confidence in private investors for future undertakings.
The announcement has received mixed reactions, with business groups applauding the government’s support for the project, emphasizing its economic benefits, while environmental organizations have raised concerns over increased emissions and the impact on climate change. The federal government’s environmental strategies include the Pathways Project for carbon capture and storage, aiming to reduce emissions intensity associated with oil production.
As the project moves forward, it is expected to undergo further consultations with stakeholders to address environmental safeguards, Indigenous involvement, and employment opportunities. The government’s commitment to environmental protection, alongside economic growth, remains a focal point in the development of the Pacific Link pipeline.