Premier Rachel Notley has made headlines for the last few weeks, peddling pipelines.
Apparently they're the solution to not only Alberta's financial problems, but also to Canada's.
She's so invested in this proposition that she's now even arguing for Enbridge's Northern Gateway, the one she earlier rejected as undoable and the one which in any case cannot happen if the Prime Minister's vow to ban tanker traffic from BC's north coast is actualized.
Well, she's an Alberta politician and Alberta politics demand she make the case. I get that. And I have no problem with her view that it's the rest of us being parochial.
It's a case she makes in spite of the fact studies have shown that Alberta would be better off relying less on fossil fuel revenues and more on a provincial sales tax.
Kind of like all the other provinces.
However, just because Albertans cannot see the world beyond their borders and perceived self-interest, doesn't mean the rest of us need to buy in, even if Notley is the last standing NDP premier and has, unlike any of her recent predecessors, started the difficult but essential job of turning her province towards reality.
Here's an interesting fact, brought to you directly from that notoriously socialist rag, the Globe and Mail: “Canada sent a record 3.2 million barrels a day of gross crude oil exports to the United States last year, up 10 per cent from 2014.”
What? Alberta has actually increased it's export of oil and is still in dire financial straits? That seems counter-intuitive.
The article does go on to say, “A lot of the discount for Western Canadian Select pricing has to do with [Canada’s] limited transportation options,” but then points out “...Canada generally produces heavy crude oil that is well matched to processing capacity in the U.S.” In other words, not every refinery is set up to process dilbit, and those in the US that can are increasing their consumption of Alberta's product. The article also goes on to note that the increased use of Canadian product in the US replaces other “heavy oil”, like that from Venezuela and Mexico.
Which of course means Venezuela and Mexico have heavy crude sailing the seas to find other buyers.
So when Rachel Notley and others like her make a case for pipelines to tidewater, what they're really asking us to believe is that the difference in price between what US refineries will pay for dilbit and what refiners in the rest of the world will pay (minus the considerable cost of shipping and handling, of course) would be the wellspring of Alberta's and Canada's economic future well being!
In other words, the dilbit sent through a maximum of three unusually expensive-to-build pipelines loaded on a couple of fleets of oil tankers cruising through some of the most difficult maritime conditions in the world and processed by the few refineries that can handle it is the key to our economic future.
That's an absurd proposition; you'll pardon me if I don't buy any of it.
And we haven't even begun to explore the environmental consequences of such a plan!
Monday, April 25, 2016
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