The Alberta government is looking to propose new legislation and create two Crown corporations to break what it calls a bottleneck in natural gas pipeline capacity. A 46-page cabinet report by the Ministry of Energy and Minerals, titled “Building a Modern Natural Gas Access Framework for Alberta’s Future,” which was leaked by a government adviser to CTV News and first reported by The Narwhal, warns the natural gas transmission network is constrained, leading to suppressed prices on natural gas, a limit on provincial royalties and driving away investments, particularly with AI data centres. The document says the main natural gas line, NOVA Gas Transmission Ltd., owned and operated by TC Energy, will be at capacity by 2029, with no plans for further expansion as of 2030. “At issue is the monopoly that TC energy has,” said premier Danielle Smith on her weekly radio show. “What we are looking at is, how do we get more competition—more choice—so that we can get more gas to more people so that it can be used?” The province is also exploring adding additional capacity, to the tune of $6 billion, which would fund a one-billion-cubic-feet-per-day pipeline, at taxpayer expense. “I think there’s enough private sector interest that we would not have to go to what they do in other provinces,” said Smith. “We would very unlikely have to create a Crown corporation to do it.” The report outlines the annual costs to set up a Crown corporation, ranging between $53.9-$162.6 billion. “If we were going to try to put in place a parallel Crown corporation system, where are those people? What skills do they have? Where is the money? Who’s the oversight?” said Richard Masson, with the University of Calgary’s School of Public Policy. “If you’re going to start doing that, you’re suddenly competing against the system that’s worked pretty effectively for decades, and those folks aren’t going to be happy with it.” The document details locked horns between the province and TC Energy when it comes to demand for natural gas in the province, with talks ongoing for more than two years. The Ministry of Energy and Minerals estimates a new pipeline at one billion cubic feet per day could generate an additional $100 million in royalties by 2034. TC Energy moves three quarters of Western Canada’s natural gas. It says it’s prepared to keep investing in its vast Alberta network to meet “generational demand” for the fuel. TC Energy Corp. released its statement days after the leak. The report also says TC’s future expansion plans for its Nova Gas Transmission Ltd. pipeline are “misaligned” with the province’s projected demand growth. “If they (TC Energy) feel that the business case is not there or that there is some uncertainty over the amount of demand for natural gas, then that is really worth listening to,” said Janetta McKenzie, director of Pembina Institute’s oil and gas program. “Alberta has incredible wind and solar resources and incredible potential for wind and solar power, but those are types of power that have been really restrained and kind of hindered by policy choices.” The NGTL network, in operation since 1957, forms a vast web stretching across Alberta and connecting into northeastern British Columbia, shipping an average of 15 billion cubic feet per day of gas. TC says natural gas demand is growing faster than infrastructure can be built, but it has invested “more than anyone” to grow its system. It says it’s spent $15 billion in the last decade on expansion projects and is continuing to grow the system with another $1 billion in planned projects. “TC Energy is prepared to keep investing in NGTL and expand the system to meet the scale of opportunity in front of Alberta and Canada. This will require all of us—industry, customers, regulators, governments, stakeholders and rights holders—to come to the table and improve the conditions to get infrastructure built,” the company said. “The key is working together to bring forward credible solutions, capital and capacity quickly enough to support Alberta’s growth and enable Canada to unlock the opportunity to meet the moment.” A statement from Minister Brian Jean’s office says governments routinely examine a wide range of policy options. “Internal materials do not represent government decisions,” read the statement. “An increasing number of project proponents across a variety of industries have raised concerns about accessing industrial quantities of natural gas in several regions of Alberta. We are working with industry, including the natural gas infrastructure owners, to better understand these issues and identify practical solutions that support future growth and investment.” Court challenges from TC Energy and potentially ATCO Gas and Pipelines Ltd. were flagged as “legal considerations” in the report. With files from Lauren Krugel, The Canadian Press
