The Canadian Prime Minister’s Cabinet has authorized the Trans Mountain oil pipeline expansion project, a strong step toward Canadian independence from the U.S. oil distribution network. The decision comes with the stated support of Prime Minister Justin Trudeau, despite an aggressive pushback effort from environmental groups and First Nation people.
Trudeau couched his decision as a means to fight climate change. The money generated from the sale of additional oil is estimated to be measured in billions of dollars for Canadian companies, with a tax revenue generation of $500 million per year. Trudeau pledged to allocate all tax money to “green energy”.
Beyond the creation of new jobs and the funding of green energy projects, the oil pipeline expansion, which would triple the diameter of the existing line between Edmonton and Burnaby, would allow Canada to sell far more of their oil to foreign markets. Government estimates put the increase as shifting from five to 34 tankers per day which could be filled by the pipeline, completely bypassing any American involvement.
Trudeau explained his decision this way: “As we’ve seen over the past few years, anything can happen with our neighbors to the south. Don’t get me wrong; Americans are strong friends, partners and allies. But Canadians are our own people, and we make our own choices. We can only make choices when we have choices.”
“Right now, when it comes to our conventional energy, we do not. We have only one customer. 99% of our conventional energy is sold to the United States – often at large discounts. Every business person knows that when you only have a single customer, you’re in a weaker position. You’re vulnerable to that customer’s desires, and to changes in their market and policy orientation. We don’t think that’s an acceptable situation for Canada.”
The inclusion of the phrase “policy orientation” is a likely jab at President Obama, who worked to reject pipeline projects between Canada and the United States; and President Trump, who raised American tariffs on Canadian goods as a bargaining tool.
This decision has been expected, as the Trudeau government has fought – both politically and in court – for the expansion of the pipeline since 2016. Environmentalists, who are against more oil production, view it as a betrayal. First Nationers, through whose land the pipeline travels, have concerns about potential damage if there are leaks in the pipeline, and the disruption of life as the construction is performed.
The Trans Mountain expansion, now expected to begin construction in 2019, will undermine and possibly even obviate the value of the Keystone Pipeline project, the authorization of which was one of President Trump’s actions to be hailed as an important victory by the Republicans in 2017.
