FORT MCMURRAY — The Canadian government is designating a proposal for a new oil pipeline to the West Coast the first-ever project of national interest under Prime Minister Mark Carney’s Building Canada Act. This decision was made on the recommendation of Intergovernmental Affairs and One Canadian Economy Minister Dominic LeBlanc, a government official speaking on a not-for-attribution basis told reporters Thursday morning in a technical briefing ahead of Carney’s announcement in Fort McMurray, Alta., alongside Alberta Premier Danielle Smith. The pipeline – a 1,200-kilometre pipeline from Bruderheim, Alta., to Delta, B.C. – is estimated to carry an extra million barrels a day when finished. “The government has determined that this project would strengthen Canada’s autonomy, resilience, and security, while creating material economic benefits that will improve the nation’s prosperity, which will be critical within the context of increasing trade uncertainty,” the official said, referencing the potential to expand Canada’s energy export market well beyond the United States. In making this call, the federal Major Projects Office – after conducting analysis of the project, the capabilities of the proponents, the environmental factors and rights of Indigenous communities – believes the pipeline could be executable within a reasonable time frame, and that “the business case is very strong.” Why this project? Citing an estimate from the Royal Bank of Canada, the official said the project could generate roughly C$20 billion annually in incremental export revenues at a Western Canadian Select price of $60 per barrel. The pipeline could also lead to $70-$80 billion in construction investment, generate upwards of 144,000 jobs at the height of building, and “will have significant positive impacts on GDP.” Despite these figures, so far, no private sector proponent has indicated any interest in paying for the project in full. The Pembina Pipeline Corp. has expressed interest in a 10 per cent private sector stake and has optioned up to another 10 per cent once the pipeline is in operation. Pressed on these figures, the official noted that in the case of the Trans Mountain pipeline, it took several years for private players to meaningfully materialize. Based on conversations had at Carney’s recent investment summit, the official said, “If it goes as expected, I would expect to see a number of private investors lining up to try to get into this project.” The designation also indicates a 10 per cent equity ownership stake for Indigenous communities, in addition to mutual benefit agreements that could see contracting, procurement, and employment opportunities offered to First Nations along the route. Environmentally speaking, the project “does not directly contribute to Canada’s greenhouse gas emission reduction targets” but it will advance climate efforts by investing in carbon reduction efforts by the Oil Sands Alliance, the official said. The official also said that conditions will be developed to mitigate potential impacts on marine and terrestrial life – including on the southern resident killer whale population – though ultimately “the government determined that these potential impacts do not displace the national interest character of the project.” Carney and Smith – who amid separation tensions in her province, has championed this pipeline as a way to allow Alberta oil to flow more freely and help address the federal government’s diversification efforts – will soon be taking questions about the project and the historic designation. What happens now? As the first project to receive this designation since Parliament passed Bill C-5 more than a year ago, the pipeline will now set off on an accelerated process aimed at ensuring investor confidence. This designation means a series of authorizations and permits have been deemed approved, and the project will now move into a regulatory review phase once the proponent provides a “comprehensive project information document,” which is expected “sometime early in 2027.” As one senior official put it: “The focus will move from whether the project [should] proceed to how it should proceed responsibly and under what conditions.” Among the timeline markers detailed in the technical briefing, in order to have the pipeline “online and through construction by the 2032 and 2033 period,” is a “conditions document” from LeBlanc to be issued by September 2027. Then, over the winter and spring of 2027, the plan is to hold public hearings on the social, cultural, health, safety, and security concerns, as well specific forums for Indigenous communities and public stakeholders. Between now and next September, the work being undertaken is estimated to cost approximately $4 billion, with a government official telling reporters the Alberta and federal governments will foot this bill. Though those costs, as well as the development of the pipeline as a whole, will eventually be charged back to the shippers and recovered. The lead official briefing reporters noted that after being involved in building projects for many years, the amount of progress made as of Oct. 1 would have taken five years to complete under the previous national process. Though, they also conceded that given this new approach, the government is anticipating there “probably” will be legal challenges ahead. While the B.C. government has stated its opposition clearly to a new pipeline, Premier David Eby – who is in the midst of a provincial election campaign – has said the government would not challenge the project. His province has recently been the recipient of a $1.2-billion funding commitment to improve marine incident prevention and strengthen ocean and ecosystem monitoring and protections.
