Trump’s tariffs made Ottawa suddenly start talking about new east-to-west pipelines, but how long will it last?

For years, oil pipelines have been a political fault line in Canada, with battles over environmental policies, economic development and national energy security. The Liberal government under Prime Minister Justin Trudeau, has sent mixed signals – championing climate goals while approving some energy projects like the Trans Mountain Expansion. But now, with a trade war looming over Canada, a surprising shift has occurred: a consensus across the political spectrum in favour of building new pipelines.

And it’s all due to one man: United States President Donald Trump.

Trump’s threat to impose a 10 percent tariff on Canadian energy and 25 percent on other Canadian exports has woken up Ottawa. Previously, Trudeau’s government made decisions that killed off big pipeline projects like Energy East. Bill C-69 was blamed for creating an uncertain regulatory environment that discouraged investment in pipelines.

But now, Liberal ministers are talking about revisiting those projects.

On February 6, Energy Minister Jonathan Wilkinson, a long-time climate crusader, surprised many when he said Canada is too dependent on the U.S. as an oil buyer and suggested Ottawa should consider a pipeline to Eastern Canada to diversify energy exports. He’d made similar comments in September and October 2024 when he said oil demand had peaked and pipelines were unnecessary.

The next day, it was reported that Industry Minister François-Philippe Champagne followed Wilkinson’s lead, saying Canada must reassess its energy infrastructure given Trump’s threat. He even suggested Quebec, which has long opposed pipelines, might be open to reconsidering Energy East.

Shortly after, Alberta Premier Danielle Smith seized the moment, urging Ottawa to restart talks on national energy infrastructure.

And then on February 9, Champagne again said Quebecers might have a different view on pipelines now that their economic security is at stake.

This is a stunning reversal. Just months ago Wilkinson and other Liberal officials were saying oil demand was declining and Canada should focus on renewables and electrification.

However, is this a real policy shift?

While some senior Liberals are suddenly in favour of pipelines, one key figure has been silent: Mark Carney, the front runner in the Liberal leadership race.

Carney has made climate action a central plank of his campaign, but says he supports the “concept” of an east-west pipeline.

His silence raises a big question: Are the Liberals really in favour of oil pipelines or is this just a reaction to Trump?

Despite Carney, Wilkinson and Champagne’s comments, big industry players remain skeptical. Pipeline projects take years of regulatory approval, billions of investment and political will at both the federal and provincial level. The Trudeau government’s track record has been one of obstacles, not encouragement, for big energy projects.

And some experts say pipeline companies may not be keen to jump back into the fray. TC Energy, the former proponent of Energy East, divested its oil pipeline business in 2023. Would a new pipeline proponent be willing to navigate the regulatory and political minefield that Ottawa itself created?

The political fallout could be immense.

If the Liberals go for pipelines, it will be one of the biggest policy reversals in Canadian energy history. It will also expose deep divisions within the party. Environmental groups and Liberal voters in urban centres will likely rage against such a shift while oil-producing provinces like Alberta and Saskatchewan will remain skeptical of Ottawa’s new enthusiasm.

Meanwhile the Conservative Party, the only federal party that has always been in favour of pipelines, will find itself in an unusual position—watching the Liberals adopt its policies as their own.

In the next few weeks all eyes will be on Carney and the Liberal leadership race. If Carney keeps hedging on pipelines, it will be unclear if this new consensus is real or just political expediency in the face of Trump’s tariffs.

For now Canada’s pipeline debate is no longer about energy or the environment—it’s about sovereignty, trade and survival in an uncertain global economy. Will this consensus last beyond the immediate crisis?

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Alberta’s grand bargain with Canada includes a new pipeline to Prince Rupert

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Alberta

Alberta’s grand bargain with Canada includes a new pipeline to Prince Rupert

Published on June 15, 2025

Todayville

From Resource Now

By Nelson Bennett

Alberta renews call for West Coast oil pipeline amid shifting federal, geopolitical dynamics.

Just six months ago, talk of resurrecting some version of the Northern Gateway pipeline would have been unthinkable. But with the election of Donald Trump in the U.S. and Mark Carney in Canada, it’s now thinkable.

In fact, Alberta Premier Danielle Smith seems to be making Northern Gateway 2.0 a top priority and a condition for Alberta staying within the Canadian confederation and supporting Mark Carney’s vision of making Canada an Energy superpower. Thanks to Donald Trump threatening Canadian sovereignty and its economy, there has been a noticeable zeitgeist shift in Canada. There is growing support for the idea of leveraging Canada’s natural resources and diversifying export markets to make it less vulnerable to an unpredictable southern neighbour.

“I think the world has changed dramatically since Donald Trump got elected in November,” Smith said at a keynote address Wednesday at the Global Energy Show Canada in Calgary. “I think that’s changed the national conversation.” Smith said she has been encouraged by the tack Carney has taken since being elected Prime Minister, and hopes to see real action from Ottawa in the coming months to address what Smith said is serious encumbrances to Alberta’s oil sector, including Bill C-69, an oil and gas emissions cap and a West Coast tanker oil ban. “I’m going to give him some time to work with us and I’m going to be optimistic,” Smith said. Removing the West Coast moratorium on oil tankers would be the first step needed to building a new oil pipeline line from Alberta to Prince Rupert. “We cannot build a pipeline to the west coast if there is a tanker ban,” Smith said. The next step would be getting First Nations on board. “Indigenous peoples have been shut out of the energy economy for generations, and we are now putting them at the heart of it,” Smith said.

Alberta currently produces about 4.3 million barrels of oil per day. Had the Northern Gateway, Keystone XL and Energy East pipelines been built, Alberta could now be producing and exporting an additional 2.5 million barrels of oil per day. The original Northern Gateway Pipeline — killed outright by the Justin Trudeau government — would have terminated in Kitimat. Smith is now talking about a pipeline that would terminate in Prince Rupert. This may obviate some of the concerns that Kitimat posed with oil tankers negotiating Douglas Channel, and their potential impacts on the marine environment.

One of the biggest hurdles to a pipeline to Prince Rupert may be B.C. Premier David Eby. The B.C. NDP government has a history of opposing oil pipelines with tooth and nail. Asked in a fireside chat by Peter Mansbridge how she would get around the B.C. problem, Smith confidently said: “I’ll convince David Eby.”

“I’m sensitive to the issues that were raised before,” she added. One of those concerns was emissions. But the Alberta government and oil industry has struck a grand bargain with Ottawa: pipelines for emissions abatement through carbon capture and storage.

The industry and government propose multi-billion investments in CCUS. The Pathways Alliance project alone represents an investment of $10 to $20 billion. Smith noted that there is no economic value in pumping CO2 underground. It only becomes economically viable if the tradeoff is greater production and export capacity for Alberta oil. “If you couple it with a million-barrel-per-day pipeline, well that allows you $20 billion worth of revenue year after year,” she said. “All of a sudden a $20 billion cost to have to decarbonize, it looks a lot more attractive when you have a new source of revenue.” When asked about the Prince Rupert pipeline proposal, Eby has responded that there is currently no proponent, and that it is therefore a bridge to cross when there is actually a proposal. “I think what I’ve heard Premier Eby say is that there is no project and no proponent,” Smith said. “Well, that’s my job. There will be soon. “We’re working very hard on being able to get industry players to realize this time may be different.” “We’re working on getting a proponent and route.”

At a number of sessions during the conference, Mansbridge has repeatedly asked speakers about the Alberta secession movement, and whether it might scare off investment capital. Alberta has been using the threat of secession as a threat if Ottawa does not address some of the province’s long-standing grievances. Smith said she hopes Carney takes it seriously. “I hope the prime minister doesn’t want to test it,” Smith said during a scrum with reporters. “I take it seriously. I have never seen separatist sentiment be as high as it is now. “I’ve also seen it dissipate when Ottawa addresses the concerns Alberta has.” She added that, if Carney wants a true nation-building project to fast-track, she can’t think of a better one than a new West Coast pipeline. “I can’t imagine that there will be another project on the national list that will generate as much revenue, as much GDP, as many high paying jobs as a bitumen pipeline to the coast.”

Canadian Energy Centre

Cross-Canada economic benefits of the proposed Northern Gateway Pipeline project

Published on June 15, 2025

Todayville

From the Canadian Energy Centre

Billions in government revenue and thousands of jobs across provinces

Announced in 2006, the Northern Gateway project would have built twin pipelines between Bruderheim, Alta. and a marine terminal at Kitimat, B.C.

One pipeline would export 525,000 barrels per day of heavy oil from Alberta to tidewater markets. The other would import 193,000 barrels per day of condensate to Alberta to dilute heavy oil for pipeline transportation.

The project would have generated significant economic benefits across Canada.

The following projections are drawn from the report Public Interest Benefits of the Northern Gateway Project (Wright Mansell Research Ltd., July 2012), which was submitted as reply evidence during the regulatory process.

Financial figures have been adjusted to 2025 dollars using the Bank of Canada’s Inflation Calculator, with $1.00 in 2012 equivalent to $1.34 in 2025.

Total Government Revenue by Region

Between 2019 and 2048, a period encompassing both construction and operations, the Northern Gateway project was projected to generate the following total government revenues by region (direct, indirect and induced):

British Columbia

Provincial government revenue: $11.5 billion
Federal government revenue: $8.9 billion
Total: $20.4 billion

Alberta

Provincial government revenue: $49.4 billion
Federal government revenue: $41.5 billion
Total: $90.9 billion

Ontario

Provincial government revenue: $1.7 billion
Federal government revenue: $2.7 billion
Total: $4.4 billion

Quebec

Provincial government revenue: $746 million
Federal government revenue: $541 million
Total: $1.29 billion

Saskatchewan

Provincial government revenue: $6.9 billion
Federal government revenue: $4.4 billion
Total: $11.3 billion

Other

Provincial government revenue: $1.9 billion
Federal government revenue: $1.4 billion
Total: $3.3 billion

Canada

Provincial government revenue: $72.1 billion
Federal government revenue: $59.4 billion
Total: $131.7 billion

Annual Government Revenue by Region

Over the period 2019 and 2048, the Northern Gateway project was projected to generate the following annual government revenues by region (direct, indirect and induced):

British Columbia

Provincial government revenue: $340 million
Federal government revenue: $261 million
Total: $601 million per year

Alberta

Provincial government revenue: $1.5 billion
Federal government revenue: $1.2 billion
Total: $2.7 billion per year

Ontario

Provincial government revenue: $51 million
Federal government revenue: $79 million
Total: $130 million per year

Quebec

Provincial government revenue: $21 million
Federal government revenue: $16 million
Total: $37 million per year

Saskatchewan

Provincial government revenue: $204 million
Federal government revenue: $129 million
Total: $333 million per year

Other

Provincial government revenue: $58 million
Federal government revenue: $40 million
Total: $98 million per year

Canada

Provincial government revenue: $2.1 billion
Federal government revenue: $1.7 billion
Total: $3.8 billion per year

Employment by Region

Over the period 2019 to 2048, the Northern Gateway Pipeline was projected to generate the following direct, indirect and induced full-time equivalent (FTE) jobs by region: