Why Quebecers should support the Energy East pipeline

Contributed to Montreal Gazette
Tim McMillan
President and CEO
Canadian Association of Petroleum Producers
January 27, 2016
Montreal has long been an important hub for transportation infrastructure – a hub that connects Canada from coast to coast to coast, and a hub that connects Canada to the world.

Every day, be it by railway, road or the Saint Lawrence Seaway, goods move through the city on their way to other parts of Canada or from Canada to international markets. Quebec and Canada are stronger because of it – transportation infrastructure is the foundation of Canada’s collective economic strength.

Building Energy East is a nationally important piece of transportation infrastructure. It would allow Quebec refineries to use Canadian crude oil instead of imports, and it would connect New Brunswick and markets abroad to Canada’s vast oil resources. All Canadians, including people in Quebec, would benefit as a result.

We need a unified national will to turn this vision into reality. 

Some say the environmental risks of building Energy East outweigh the economic benefits. This argument, however, overlooks the larger benefits of Canadian oil infrastructure to Quebec and Canada, as well as the industry’s safety record.

Canadian Energy Pipeline Association data shows that between 2002 and 2013, pipelines transported oil with a 99.999 per cent safety record. This includes pipelines that feed refineries in Quebec.

These refineries process oil, much of which arrives in Quebec from foreign sources such as the United States, Algeria, Angola and Kazakhstan at higher prices than Canadian oil.

The province spent nearly $14 billion in 2013 on oil imports, according to government data. That’s the equivalent of the annual economic activity created by Canada’s beer sector, founded in Montreal by the Molson family, and it’s money that flows out of the province, with little in the way of economic return.

Canada has the third-largest oil reserves in the world, yet much of the oil for Quebec and Atlantic Canada is imported.

Expanding pipeline infrastructure in Quebec and Atlantic Canada will allow us to keep the money spent on imports in Canada, where it can help create jobs and grow the economy. That, indeed, would be a substantial economic benefit in addition to the benefits from oil sands development Quebec already enjoys.

The Canadian oil sands sector has purchased $600 million in goods and services from Quebec over the past two years. More than 190 Quebec companies, many in the Montreal area, have direct business relationships with the oil sands. By expanding Canada’s pipeline infrastructure, we can build on these benefits and stimulate the kind of economic activity that keeps people working.

And this is the crux of my argument: pipelines are nationally important infrastructure that helps build Canada’s economic strength, just like highways and railroads. These Canadian infrastructure projects will generate revenue and create jobs, all without any taxpayer funding. The ability for Canadian oil to have more access to more markets is critical for the industry, the national economy and the prosperity of all Canadians, including people in Quebec.

In view of Alberta’s stringent carbon policy and climate leadership plan, using responsibly produced Canadian oil in Quebec is also an opportunity to displace oil from foreign countries that have less stringent environmental standards. Many of the oil suppliers to Quebec do not have the regulatory system or transparent environmental reporting Canada has.

Environment Canada reports that emissions per barrel of oil produced from the oil sands are down 30 per cent from 1990 levels. Pilot projects in the oil sands, such as the use of solvents for in situ projects, will reduce emissions even further.

These are some facts that should inform a reasonable debate about how Canada collectively can take action to build the pipeline infrastructure that will make our provinces and country stronger.

We should all get behind this effort to slice through the Gordian knot that prevents our country from reaping the full benefits of our abundant oil and natural gas resources.