File photo by THE CANADIAN PRESS A aerial view of Kinder Morgan’s Trans Mountain marine terminal filling a oil tanker in Burnaby, B.C. In a statement Friday, Natural Resources Minister Amarjeet Sohi said an NEB report confirms that Canada needs to build new pipelines.

Getting more oil to market in Canada requires more pipelines, NEB says

OTTAWA — The National Energy Board says Canada’s existing export pipelines are running at maximum efficiency and the only way to realistically get more oil to market through pipelines is to build more of them.

The board responded Friday to questions posed last fall by Natural Resources Minister Amarjeet Sohi, who wanted to know if there was any way to improve the efficiency of pipelines while Canada struggles to expand existing lines or get new ones built.

“In a nutshell, pipelines are full,” said Jean-Denis Charlebois, the chief economist for the National Energy Board.

In a statement Friday, Sohi said the report confirms that Canada needs to build new pipelines.

The report says the amount of oil Canada is producing has increased while the capacity of pipelines to carry it has not. There are five pipeline projects, the report notes, that have been proposed and then cancelled or delayed in recent years. That includes the Trans Mountain pipeline expansion, which is in limbo pending a new round of reviews after a Federal Court of Appeal ripped up cabinet approval for it last year.

The NEB recently recommended cabinet proceed with the Trans Mountain expansion after completing a new review of the impact it will have on marine life. A new round of Indigenous consultations is underway and could be completed this spring.

The others are the Energy East pipeline from Alberta to the east coast (which Trans Canada abandoned), the Northern Gateway pipeline between Alberta and northern British Columbia (which the Liberals rejected in 2016), and the Keystone XL pipeline and the Enbridge Line 3 replacement (both of which face uncertainty due to regulatory challenges in the United States).

Altogether, those five projects could have added 3.4 million barrels of oil per day to Canada’s shipments. According to the NEB, the capacity in pipelines out of western Canada was just under four million barrels a day as of last September.

The report says moving more oil by rail is also not a “perfect substitute” because doing so is more expensive and complex.

It also tells Sohi that while there is room to streamline the system used by oil producers to get access to pipeline space, doing so would only reallocate existing capacity, not create more.

The improvements largely surround how the pipelines verify the ability of producers to supply the amounts of oil they want to ship in pipelines. The way the system works now, sometimes companies overestimate how much they can send, expecting that when the limited space is allocated on a percentage basis they will end up getting what they actually need.

Sohi’s request to the board came last fall as Canadian oil prices plunged thanks to temporary refinery closures in the Midwest, creating a price differential between Canadian oil and U.S. oil of $50 per barrel.

Just Posted

WATCH: UCP leader Jason Kenney makes stop in Red Deer

A rally was held in the north end of the city Saturday afternoon

Good-bye ice and snow, hello potholes on Red Deer roads

City workers will be spending 20 hours a day on various road repairs

Fog advisory in effect for Red Deer, central Alberta

Heavy fog is affecting visibility for central Alberta drivers Saturday morning. A… Continue reading

Climate change’s impact on outdoor hockey discussed in Red Deer

Red Deer River Watershed Alliance held a forum Friday at the Alberta Sports Hall of Fame

Collision between Red Deer transit bus and truck investigated by RCMP

No one on bus was hurt, truck driver had minor injuries

WATCH: Fashion show highlights Cree designers

The fashion show was part of a Samson Cree Nation conference on MMIW

Montreal priest stabbed during mass leaves hospital; suspect to be charged

MONTREAL — A Catholic priest who was stabbed as he was celebrating… Continue reading

No winning ticket for Friday night’s $35.7 million Lotto Max jackpot

TORONTO — No winning ticket was sold for the $35.7 million jackpot… Continue reading

New report details impact of proposed NS spaceport in event of explosion or fire

HALIFAX — The head of a company proposing to open Canada’s only… Continue reading

Quebec man convicted in Mafia-linked conspiracy deported to Italy

MONTREAL — Michele Torre, a Quebec man convicted in 1996 for his… Continue reading

Republican Karl Rove says conservatives need more than simplistic slogans

OTTAWA — Legendary Republican campaign strategist Karl Rove, known for his no-holds-barred… Continue reading

B.C. hospital’s use as shelter ‘clarion call’ about housing crisis, says mayor

The 10-bed regional hospital that serves the medical needs of 5,000 people… Continue reading

Puddle splashing: A rite of spring

Is there anything more fun than driving through water-filled potholes in the… Continue reading

Special evaluations can help seniors cope with cancer care

Before she could start breast cancer treatment, Nancy Simpson had to walk… Continue reading

Most Read