For Jim Prentice, winning the Alberta election meant his government would have likely overseen the approval of pipelines for market access and the opening of a new refinery in the province, the North West Sturgeon Upgrader. Now that distinction is likely to go to Rachel Notley and the NDP.
The NDP have always been passionate about climate change and the environment. Even if they take a little more time to propose a new climate change strategy for Alberta, the good money is on a relatively early introduction. This may end up being the card Obama needs to claim a win on the issue and to approve the Keystone Pipeline prior to his departure from office. If not, the next president, irrespective of the political stripe, will more than likely approve the pipeline.
In terms of the other projects on Alberta’s radar, TransCanada is likely to submit amendments before the end of next week on its Energy East proposal that will forego a port in Cacouna, Quebec. Though this is a significant hit to providing economic benefit to Quebec from the pipeline, the environmental assessment will be easier to manage without the port. To the West, though Notley has expressed concerns with Northern Gateway, she has been supportive of Kinder Morgan’s Trans Mountain expansion.
Pipelines are only half the story. The NDP have committed to making job creation their first priority. To do so, they believe that focusing on the value-added sector is a viable approach. Though some disagree, the organization behind the construction of the upgrader believes that through the long-term commitments made by “payers” along with “an evergreen option to continue utilizing the refinery for the remainder of its service life at the current operating costs… the Refinery will generate profits.” If this is the case, the five other projects shelved during the 2008 recession may be reconsidered in the future.
It’s a backwards world we live in when it is an NDP government that will rule over pipeline approvals and increased oil refining. But that is exactly what might happen in Alberta. The debate up to now has centred on rip-and-ship versus value-added manufacturing in the oil and gas sector, but this is a false dichotomy. Alberta does need to find a way off the rollercoaster. Advancing a revamped and more stringent carbon pricing strategy may be just what is needed to sway public opinion to support major infrastructure projects in the oil and gas sector. It could add significant revenue to the provincial budget. And it is just what Canadian economists have been advocating.