Canada's Original Think Tank

Oil pipeline to eastern Canada

Oil pipeline to eastern Canada

Oil pipeline to eastern Canada

Hon. Joseph A. Day (Leader of the Senate Liberals): 

Minister, thank you for being here.

When you were last here, I asked a question about the Energy East Pipeline project. We know what happened when the National Energy Board amended the assessment criteria halfway through the process and how TransCanada then halted the project given the regulatory uncertainty it was facing, certainly not a good message to potential investors, as you have just commented.

The problem remains, minister, that we’re having difficulty moving Alberta oil westward over the mountains via pipeline, and the oil cannot move east unless it’s moved in rail cars. As a result, Eastern Canada is importing more than 750,000 barrels of oil per day for processing when we have oil that we can’t move out of southern Alberta and Saskatchewan.

Energy East would have carried 1.1 million barrels of oil to Atlantic Canada every day at a lower cost than the imported oil that is being brought in by tankers. It would have been a great economic impact to Atlantic Canada, New Brunswick, to Saint John, New Brunswick, and indeed to all of Canada.

The government has been explicit in its support for Keystone and Trans Mountain expansion, and I fully support that, minister. Does the government also unequivocally support the building of a pipeline that would move oil from Western Canada to Eastern Canada?

Is the Government of Canada prepared to say that the Energy East Pipeline would be in the national interest? I saw you being interviewed yesterday on television, and you used that term several times, that it is in the national interest and we are sticking with that decision we’ve made.

But the problem is when Energy East was in debate, I never heard that to the same extent. I never saw the federal government showing the support for the Energy East Pipeline that was needed in order to get that done.

Mr. Carr: Senator, the reason that you didn’t hear the Government of Canada support Energy East is because it hadn’t been approved by the National Energy Board. So what you’re asking me, and through me the Government of Canada, to do is to approve a pipeline before it has been through the regulatory process. How can we do that?

Secondly — and I’m glad you asked the question because — how many pipelines had been approved at the time that TransCanada initiated the application to do Energy East? Was Keystone XL approved? No. Had the Enbridge Line 3 been approved? No. Had the Trans Mountain expansion pipeline been approved? No.

What happened in between the time that TransCanada made its application and the time it withdrew its application is that there were three pipeline approvals, which obviously impacts market conditions.

What was the price of oil at the time that the Energy East proponent established contact with the National Energy Board? What was the price of oil at the time that it withdrew its application? We make the argument that business decisions had changed dramatically.

The second point: We said clearly to the proponent and clearly to Canadians who were listening that exactly the same interim principles that were used to approve Trans Mountain would have been used to assess Energy East if it had made it through the regulatory process. The proponent decided, for its own reasons, to withdraw the application.

Senator Day: Minister, is it not possible for the government to indicate support for the concept of moving oil from West to East other than by rail cars by saying, “A pipeline would be in the interest of Canada; we’re prepared to invest from an infrastructure point of view”?

Mr. Carr: Again, senator, you’re asking me to comment on a hypothetical pipeline.

I would ask you the question: How many Indigenous peoples were consulted? Is the pipeline going through rivers and streams? Has the environmental stewardship of the project been assessed by a regulatory agency?

So it’s impossible for a government to comment on a mythical pipeline. That’s why we have a statutorily created energy agency and regulator to determine all of the factors and then make a recommendation to government. Government looks at all of the evidence, looks at the degree of consultation, assesses the jurisprudence that would inform the Government of Canada on whether or not enough consultation had occurred and then makes a decision in the public interest. When this decision is made and the federal government has decided this project is good for Canada, then I come to the floor of the Senate and tell you why and make speeches across the country and have interviews with editorial boards and go on television, which is what I do all the time. But there is a difference between an approved pipeline and a mythical one.