Oil, wine & gas flammable mix

The Alberta government doesn’t object to pipelines very often, for obvious reasons. So the Alberta Ministry of Energy’s intervention last week at the National Energy Board over a proposed gas pipeline in B.C. prompted some intense speculation in the B.C. legislature Wednesday. The ministry delivered a complicated, highly technical argument to federal regulators about the tariff that is proposed for that 305-kilometre natural gas line in northeast B.C.

The more interesting thing about the letter is that it’s dated Feb. 8. That’s eight days after B.C. released its threat to start restricting diluted-bitumen shipments through B.C.

The B.C. Liberals read it as an unmistakable retaliation for B.C.’s oil threat. But it’s far from clear that the linkage is that direct. Alberta is objecting to the pricing system that’s proposed for the firms that would use it. It’s a dense argument about cross-subsidization impacts and tolling variances and the “cost causation principle.”

The 305-kmline through the Peace country would move B.C. natural gas through to Alberta for distribution far and wide. Alberta later confirmed the intervention has nothing to do with the B.C. fight and that the government is simply standing up for fair and reasonable tolls on the Alberta gas industry.

So it goes down as a swing and a miss for the Liberals in their first question period of the new year. It’s still a measure of how hyper-sensitive people are these days, that a mundane NEB filing can be perceived as another round of hostility over the movement of diluted bitumen.

“This is not a coincidence,” B.C. Liberal Leader Andrew Wilkinson told the house. Actually, that’s exactly what it was. He said the oil fight had morphed in the space of a week into a wine war that will cost the Okanagan $70 million now that Alberta liquor stores are closed to B.C. wine. Now he said a $2-billion gas pipeline is in play.

It’s not inconceivable it could come to that. But the two provinces aren’t there yet.

Wilkinson was on more solid ground when it came to the wine fight, in which a high-profile B.C. industry is going to take a hit as a direct result of the NDP government’s oil threat. The Stella Schmidt winery in Oliver relayed a plea to the government through Wilkinson: “Our winery is an innocent victim of a petty dispute between two irrational NDP governments. Fix this any way you can, right now.”

Premier John Horgan matched Wilkinson’s bluster with some of his own, saying the new opposition leader doesn’t care about the coast or the effects of a catastrophic spill.

The NDP is clearly taken aback at the immediacy and intensity of Alberta’s response to its mention of possible “restrictions” on bitumen shipments through B.C.

So Horgan is going to pitch it as “standing up for the interests of this province.”

On the wine front, there were hints about how the NDP government is going to make up for the lost revenue represented by the 10 per cent of Okanagan wine shipped to Alberta. They’re going to sell as much as they can in Asia. Horgan said B.C. wine was served at every event during his recent overseas trade trip.

“We’re delighted to have the product in those markets … an area we’re going to focus our attention.”

There will also be a big push to sell more B.C. wine in B.C. Wilkinson said it amounts to asking British Columbians to “drink themselves out of a constitutional crisis.”

Agriculture Minister Lana Popham said April will be declared B.C. Wine Month, which sounds a lot more fun than the already designated “construction and skilled trades month.”

“It’s a good news story. We are going to fight for our B.C. wine industry,” she said. “We know how important they are.”

The marketing push ignores the fact that domestic sales amount to just chasing the same B.C. dollar around in circles. It’s export sales that create real new revenue.

If it comes to direct financial support for the Okanagan wineries, the B.C. government could find itself in an uncomfortable position, given the number of boutique Okanagan wineries owned by wealthy Albertans who wanted to do something fun with their oil money.

Les Leyne covers the B.C. Legislature for the Victoria Times Colonist. This column appears weekly in The Herald.