Gillian Steward: B.C. election turns up volume of pipeline battle,

It’s still not clear who will eventually control the reins of government in B.C. Recounts could give the Liberals one more seat and a majority. Or the NDP and the Greens could agree to a majority coalition and edge out the Liberals.

This has caused some to speculate that whatever the outcome, Alberta Premier Rachel Notley will be the biggest loser because the Trans Mountain oil pipeline, one of her pet projects, is now in jeopardy. Prime Minister Justin Trudeau could also end up with egg on his face because he has also backed that pipeline, despite fierce opposition in the lower mainland and on the coast.

Both the NDP and the Greens have clearly stated they want to stop the pipeline no matter what the federal and Alberta governments want. And with half of B.C. voters backing parties that are opposed to it, how could the controversial pipeline expansion, which would triple delivery of diluted bitumen from Alberta to B.C.’s southern coast to be poured into huge tankers, possibly proceed as planned?

There’s no question the Trudeau government’s green light for the $7.4-billion Trans Mountain project, which would be built and maintained by Kinder Morgan, gave Notley’s NDP government a tangible and badly needed victory.

It signalled that the NDP was indeed capable of negotiating gains for Alberta’s petroleum basedeconomy, especially at a time when low oil prices had left that economy in the dumps and the industry believed the NDP would likely make things worse.

But the negotiations involved levying a tax on carbon consumption and putting a cap on oilsands emissions in order to prove Alberta was willing to clean up its act, if that’s what it took to get pipeline approvals.

Those moves cost Notley politically but at least she could brag that Alberta got the pipeline it wanted.

So if the Trans Mountain project is in jeopardy, does that mean Notley will now have to admit defeat? And what about Trudeau? Does he risk losing B.C. seats if he insists on overruling a B.C. government that doesn’t want the pipeline?

Not necessarily. A lot has changed since the Trudeau government gave the go ahead for Trans Mountain in November. For one thing, Donald Trump is now president of the United States. Shortly after he moved into the Oval Office, Trump signed an executive permit for construction of the Keystone XL pipeline, which, when completed, would ship diluted bitumen from northern Alberta to refineries on the Gulf of Mexico.

After years of protests and stalling, former U.S. president Barack Obama had nixed that pipeline on the grounds it would encourage further oilsands development, increasing carbon emissions and making it more difficult to rein in climate change.

A grinning Russ Girling, the president of Calgarybased TransCanada, the company that will build the Keystone XL pipeline, was standing next to Trump when he ceremoniously signed the new order in March.

Keystone XL wasn’t an option when Trans Mountain got the go-ahead from the federal government in November. Now it is. And that may make all the difference for Notley and Trudeau.

It appears Kinder Morgan may have the most to lose if the Trans Mountain pipeline is stalled or stopped in B.C., not Rachel Notley or Justin Trudeau.

Something else has changed, too. As a consequence of new oil pipeline capacity in the U.S., the gap between the lower price for Canadian heavy oil delivered to Gulf Coast refineries and the higher price for lighter U.S. crude oils has narrowed significantly.

The price gap had been a strong argument for shipping oil to Canada’s coasts so it could be exported to Asia, where it would fetch a better price than in the U.S. Now that argument is weaker, which means both Trans Mountain and the Energy East pipeline, which would ship oil to Canada’s East Coast, might not be worth the trouble.

In the end, B.C.’s election outcome could seriously shake up pipeline politics. But then again, when has anything to do with an oil pipeline these days been predictable?