The Kinder Morgan Pipeline Expansion saga has lately had more twists and turns than the road to Ruby Lake and more wrinkles than a snapping turtle’s extremities.
The latest wrinkle came Wednesday afternoon when the Musqueam Indian Band put out an urgent release calling for a reasonable solution to the pipeline impasse.
“Musqueam agrees with the recent statement made by our relative, Sto:lo First Nation Chief Ernie Crey: ‘Not all First Nations oppose the Kinder Morgan proposed pipeline,’” the release said. It went on to note that, “according to Canada,” 33 First Nations in B.C. and 10 in Alberta have signed mutual benefit agreements with Kinder Morgan. “If these numbers are correct, the vast majority of directly impacted First Nations have agreements with the company. Musqueam knows the serious risks of increased oil transport via rail if the pipeline project is cancelled. While Musqueam is not one of those First Nations who have negotiated agreements, we are preparing a list of conditions and voicing our concerns.”
The release was added confirmation that B.C. First Nations are as divided as the rest of the country, and indeed the province as a whole, over the Trans Mountain project.
Perhaps the strangest wrinkle to unfold in this never-ending saga was the political reaction to Kinder Morgan’s announcement two Sundays ago that it was halting non-essential activities on the pipeline and, blaming the B.C. government’s obstructionism, had set May 31 as a deadline to decide whether to proceed. As well as fuming and fussing at B.C., Alberta Premier Rachel Notley said her government was ready to invest in the pipeline, or take it over completely, to keep it on track. Not to be outdone, following his confab last Sunday with Notley and B.C. Premier John Horgan, Prime Minister Justin Trudeau said the federal government is also willing to provide financial support for Trans Mountain, describing it as “a vital strategic interest to Canada.” After years of political battling over the pipeline, suddenly there was money all over the table. What had happened?
What happened is that the project is increasingly looking like a stinker. In an oft-quoted article that first appeared last month in Energy Mix, investigative reporter Paul McKay wrote that the newly operational Louisiana Offshore Oil Port (LOOP) terminal, dedicated to supertankers that can each carry two million barrels of oil (four times as much as a tanker’s allowable capacity in Burrard Inlet), is likely a fatal blow to Kinder Morgan’s plans to expand unrefined bitumen exports.
“There is no business case for an expansion of Alberta’s oilsands on the scale needed to justify the Keystone XL and Trans Mountain export pipelines because of one bare fact: there are zero foreign buyers who today will commit to decades-long purchase contracts for unrefined bitumen at a fixed price near US$80 per barrel,” McKay wrote.
“Instead, global traders will literally buy future oil by the boatload, then book terminal time at any deepwater ocean port like the LOOP, anywhere in the world, to embark with two million barrels in a single cargo. Vancouver will never be one of those ports... So the pending Trans Mountain pipeline plan to triple oilsands exports, and increase oil tanker traffic under the Lions Gate Bridge up to seven-fold, is doomed. So is the plan to expand oilsands output by 40 per cent. No amount of cheerleading, or demonizing, or pixie dust will change the raw laws of global oil economics.”
For purely political reasons, Notley and Trudeau need this project at this time – or at least need voters to believe that they went down fighting to save it. In Trudeau’s case, after cancelling Northern Gateway and regulating Energy East into an early grave, Trans Mountain is seen by many as his “last chance Texaco.”
If Alberta wants to buy the pipeline and socialize its oilsands economy, taking all the risks that come with it, that’s for Alberta to decide. But Canadian taxpayers should not be shelling out for this project. If Trudeau goes ahead with this folly, it will make his father’s famous one-finger salute to Western Canada look like a friendly gesture.
