Not­ley ready to re­strict oil if op­po­si­tion con­tin­ues

Edmonton Journal - - FP EDMONTON - GE­OF­FREY MOR­GAN

Alberta Premier Rachel Not ley threat­ened Wed­nes­day to cut off oil ship­ments to Bri­tish Columbia “very quickly,” as her gov­ern­ment passed its con­tro­ver­sial new law that grants it sweep­ing new pow­ers over oil and gas ship­ments.

Not­ley said she would use the law, in­tro­duced last month, if con­struc­tion does not be­gin on Kinder Mor­gan Canada’s $7.4-bil­lion Trans Moun­tain pipe­line ex­pan­sion soon.

“Al­ber­tans, Bri­tish Columbians and the rest of Canada should un­der­stand that if the path for­ward for the pipe­line through B.C. is not set­tled soon, I am ready and pre­pared to turn off the taps,” Not­ley said in her most di­rect threat re­gard­ing B.C.’s op­po­si­tion to the pipe­line.

Alberta says the law is necessary as all pipe­lines leav­ing the prov­ince are full, which has re­sulted in Cana­dian oil be­ing heav­ily dis­counted rel­a­tive to U.S. and global oil bench­marks. “Alberta has the right to act in the pub­lic in­ter­est to re­duce the cost to the trea­sury,” Not­ley said.

Cana­dian heavy oil traded at a discount of $19.19 per bar­rel on av­er­age Tues­day, ac­cord­ing to GMP FirstEn­ergy. Sco­tia­bank es­ti­mates that the Cana­dian econ­omy would lose $15.6 bil­lion this year if heavy oil prices were dis­counted by US$24 per bar­rel, and called the sit­u­a­tion a “self-in­flicted wound” in a re­port in Fe­bru­ary.

Not­ley cited the eco­nomic im­pact as she in­di­cated a move to cut off all ship­ments to B.C. could be im­mi­nent.

If Alberta does make such a move, the re­sult would be an im­me­di­ate in­crease of 30 to 45 cents per litre in Van­cou­ver, Gas­Buddy se­nior an­a­lyst Dan McTeague said. The cur­rent av­er­age whole­sale price of ga­so­line in the Van­cou­ver area is $1.56 per litre, he said. The ad­di­tional costs would bring the cost to fill up a typ­i­cal 60-litre-tank car in the area up to $120.

Rachel Not­ley

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