Alberta forum applauds linking carbon-tax launch and pipelines
LAKE LOUISE, Alta. — Social commentator Rex Murphy says it should be illegal for Canadian governments to collect carbon taxes until there are new export pipelines delivering Alberta crude oil to world markets.
A sold-out audience at the Bennett Jones Lake Louise World Cup Business Forum leaped to their feet in a standing ovation as the former CBC commentator ended a fiery speech criticizing environmentalists and federal politicians alike for stalling pipelines.
A lack of pipeline capacity is blamed for a glut of oil in Western Canada that has resulted in Western Canadian Select bitumenblend crude trading at as much as $52 per barrel less than New Yorktraded West Texas Intermediate.
The Newfoundland-born orator quoted Prime Minister Justin Trudeau who said this week in Calgary the discounts amount to a “crisis,” adding he holds Ottawa accountable for that crisis.
On the sidelines, executive fellow Ted Morton with the University of Calgary’s School of Public Policy, said Murphy’s speech resonates with many in the oilpatch who feel betrayed by the government despite Alberta’s financial contributions to the country.
Trudeau said on Thursday the federal government is addressing Alberta concerns by buying the Trans Mountain pipeline and its expansion project for $4.5 billion last summer and by continuing to try to get the expansion built after the Federal Court of Appeal struck down its National Energy Board approval in August.
“Until there are pipelines leaving Alberta — plural — and there is oil flowing through them that will go to international markets, and $40 price differentials are no longer the thing, until that time, it should be illegal for two lips to close on the phrase, carbon tax,” said Murphy.
Meanwhile, Alberta Premier Rachel Notley said she’s disappointed with Ottawa’s lukewarm response to the province’s plan to ease oil bottlenecks by buying more rail cars.
She said it’s simplistic to dismiss buying rail cars by saying they probably wouldn’t arrive until a pipeline expansion were already under construction.
Alberta oil is currently selling at a discount of about $45 a barrel because of an oil glut due to a lack of pipeline capacity.
Notley has proposed Ottawa invest in moving oil to market on rail cars in the meantime and as a hedge against future shipping problems.
Notley said Trudeau left Alberta with a better idea of how crucial the issue is than when he arrived. She’s also thanking people who she says helped her make her point when they shut down part of a downtown Calgary street for a rally during Trudeau’s visit.
Alberta could go ahead with the rail car purchase with or without the federal government, she said Friday in Edmonton.
“The government of Alberta will do what it needs to do, whether we do it by ourselves or with support from Ottawa,” she said. “It might be reasonable for them to come to the table.”
Notley is planning a trip to Ottawa and Toronto next week for meetings and speeches to try to keep the oil bottleneck on the federal government’s front-burner.
She has said the price gap between Canadian and U.S. crude is costing the country’s economy $80 million a day.
Trudeau said in Calgary that the federal government is doing what it can to get the Trans Mountain pipeline expansion built, which would triple the line’s capacity to carry oil to tankers on the west coast.