Energy

New Brunswick Premier presses Quebec leader over Alberta oil

MONTREAL — The Globe and Mail

Quebec Premier Pauline Marois greets New Brunswick Premier David Alward at her office in Montreal, Monday, February 18, 2013. (Graham Hughes/THE CANADIAN PRESS)

New Brunswick Premier David Alward travelled to Montreal Monday to try to convince Pauline Marois that moving Alberta oil to the East Coast through Quebec would benefit all provinces. But Quebec Premier did not say if she was swayed by his arguments.

Both premiers refused to meet reporters after their hour-long meeting, during which new unemployment insurance rules were also discussed, according to Ms. Marois’s press officer, Marie Barrette.

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Mr. Alward, who earlier this month toured the Alberta oil sands and met with Premier Alison Redford, is an enthusiastic proponent of a TransCanada Corp. pipeline project that would carry Western oil to the refineries of Eastern Canada – which could allow for crude exports from the deep-water port of Saint John.

East Coast refineries currently rely on oil imported from Europe and Africa, which puts them at a disadvantage with other North American refineries that have access to cheaper continental oil. The price difference between North Sea Brent and Western Canada Select currently exceeds $40 (U.S.) per barrel.

Another proposal, which would reverse the flow of the Enbridge Inc. pipeline that runs between Sarnia, Ont., and Montreal, would help Suncor Energy’s Montreal-East refinery as well as Ultramar’s refinery in St-Romuald, near Quebec City. “Mid- to long-term, our survival depends on this; we can’t sustain higher prices indefinitely,” said Michel Martin, Ultramar’s public affairs director.

When the Enbridge pipeline was first put in service in 1976, it moved eastward. Its flow was reversed in 1997. At the time, the Quebec government was reluctant about the change and asked the National Energy Board that the pipeline revert to its original direction when Alberta’s oil became more competitively priced than imports. The Quebec government was then led by Lucien Bouchard, who recently stepped down as president of the Quebec Oil and Gas Association.

Government officials from Alberta and Quebec are discussing the reversal of the Enbridge pipeline. As for the TransCanada project, Ms. Marois wants to know more before deciding whether it would be in Quebec’s interest.

The quantities of oil that pipeline promoters hope to move eastward “clearly exceed local needs,” said Patrick Bonin, head of the climate and energy campaign for Greenpeace Canada. “They want to tap into the export market, which would allow them not only to unload their current surpluses but to press forward with their green-house gas intensive expansion plans,” he says.

Mr. Bonin is also concerned that the old pipes were not built to carry heavier crude, meaning that oil spills could occur and they would be difficult to clean up. The pipeline industry disputes that argument, arguing that heavier oil is no more abrasive or dangerous than conventional crude.

Quebec Environment Minister Yves-François Blanchet said in an e-mail statement that he favours a public inquiry to ensure social acceptance of the pipeline projects, given the environmental concerns. However, the government has not committed itself to holding such an inquiry.

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