Alberta
Game changer: Trans Mountain pipeline expansion complete and starting to flow Canada’s oil to the world
Workers complete the “golden weld” of the Trans Mountain pipeline expansion on April 11, 2024 in the Fraser Valley between Hope and Chilliwack, B.C. The project saw mechanical completion on April 30, 2024. Photo courtesy Trans Mountain Corporation
From the Canadian Energy Centre
By Will Gibson
‘We’re going to be moving into a market where buyers are going to be competing to buy Canadian oil’
It is a game changer for Canada that will have ripple effects around the world.
The Trans Mountain pipeline expansion is now complete. And for the first time, global customers can access large volumes of Canadian oil, with the benefits flowing to Canada’s economy and Indigenous communities.
“We’re going to be moving into a market where buyers are going to be competing to buy Canadian oil,” BMO Capital Markets director Randy Ollenberger said recently, adding this is expected to result in a better price for Canadian oil relative to other global benchmarks.
The long-awaited expansion nearly triples capacity on the Trans Mountain system from Edmonton to the West Coast to approximately 890,000 barrels per day. Customers for the first shipments include refiners in China, California and India, according to media reports.
Shippers include all six members of the Pathways Alliance, a group of companies representing 95 per cent of oil sands production that together plan to reduce emissions from operations by 22 megatonnes by 2030 on the way to net zero by 2050.
The first tanker shipment from Trans Mountain’s expanded Westridge Marine Terminal is expected later in May.
Photo courtesy Trans Mountain Corporation
The new capacity on the Trans Mountain system comes as demand for Canadian oil from markets outside the United States is on the rise.
According to the Canada Energy Regulator, exports to destinations beyond the U.S. have averaged a record 267,000 barrels per day so far this year, up from about 130,000 barrels per day in 2020 and 33,000 barrels per day in 2017.
“Oil demand globally continues to go up,” said Phil Skolnick, New York-based oil market analyst with Eight Capital.
“Both India and China are looking to add millions of barrels a day of refining capacity through 2030.”
In India, refining demand will increase mainly for so-called medium and heavy oil like what is produced in Canada, he said.
“That’s where TMX is the opportunity for Canada, because that’s the route to get to India.”
Led by India and China, oil demand in the Asia-Pacific region is projected to increase from 36 million barrels per day in 2022 to 52 million barrels per day in 2050, according to the U.S. Energy Information Administration.
More oil coming from Canada will shake up markets for similar world oil streams including from Russia, Ecuador, and Iraq, according to analysts with Rystad Energy and Argus Media.
Expanded exports are expected to improve pricing for Canadian heavy oil, which “have been depressed for many years” in part due to pipeline shortages, according to TD Economics.
Photo courtesy Trans Mountain Corporation
In recent years, the price for oil benchmark Western Canadian Select (WCS) has hovered between $18-$20 lower than West Texas Intermediate (WTI) “to reflect these hurdles,” analyst Marc Ercolao wrote in March.
“That spread should narrow as a result of the Trans Mountain completion,” he wrote.
“Looking forward, WCS prices could conservatively close the spread by $3–4/barrel later this year, which will incentivize production and support industry profitability.”
Canada’s Parliamentary Budget Office has said that an increase of US$5 per barrel for Canadian heavy oil would add $6 billion to Canada’s economy over the course of one year.
The Trans Mountain Expansion will leave a lasting economic legacy, according to an impact assessment conducted by Ernst & Young in March 2023.
In addition to $4.9 billion in contracts with Indigenous businesses during construction, the project leaves behind more than $650 million in benefit agreements and $1.2 billion in skills training with Indigenous communities.
Ernst & Young found that between 2024 and 2043, the expanded Trans Mountain system will pay $3.7 billion in wages, generate $9.2 billion in GDP, and pay $2.8 billion in government taxes.
“If Ottawa had it’s way Albertans would be left to freeze in the dark”
The ineffective federal net-zero electricity regulations will not reduce emissions or benefit Albertans but will increase costs and lead to supply shortages.
The risk of power outages during a hot summer or the depths of harsh winter cold snaps, are not unrealistic outcomes if these regulations are implemented. According to the Alberta Electric System Operator’s analysis, the regulations in question would make Alberta’s electricity system more than 100 times less reliable than the province’s supply adequacy standard. Albertans expect their electricity to remain affordable and reliable, but implementation of these regulations could increase costs by a staggering 35 per cent.
Canada’s constitution is clear. Provinces have exclusive jurisdiction over the development, conservation and management of sites and facilities in the province for the generation and production of electrical energy. That is why Alberta’s government is referring the constitutionality of the federal government’s recent net-zero electricity regulations to the Court of Appeal of Alberta.
“The federal government refused to work collaboratively or listen to Canadians while developing these regulations. The results are ineffective, unachievable and irresponsible, and place Albertans’ livelihoods – and more importantly, lives – at significant risk. Our government will not accept unconstitutional net-zero regulations that leave Albertans vulnerable to blackouts in the middle of summer and winter when they need electricity the most.”
“The introduction of the Clean Electricity Regulations in Alberta by the federal government is another example of dangerous federal overreach. These regulations will create unpredictable power outages in the months when Albertans need reliable energy the most. They will also cause power prices to soar in Alberta, which will hit our vulnerable the hardest.”
Finalized in December 2024, the federal electricity regulations impose strict carbon limits on fossil fuel power, in an attempt to force a net-zero grid, an unachievable target given current technology and infrastructure. The reliance on unproven technologies makes it almost impossible to operate natural gas plants without costly upgrades, threatening investment, grid reliability, and Alberta’s energy security.
“Ottawa’s electricity regulations will leave Albertans in the dark. They aren’t about reducing emissions – they are unconstitutional, ideological activist policies based on standards that can’t be met and technology that doesn’t exist. It will drive away investment and punish businesses, provinces and families for using natural gas for reliable, dispatchable power. We will not put families at risk from safety and affordability impacts – rationing power during the coldest days of the year – and we will continue to stand up for Albertans.”
“Albertans depend on electricity to provide for their families, power their businesses and pursue their dreams. The federal government’s Clean Electricity Regulations threaten both the affordability and reliability of our power grid, and we will not stand by as these regulations put the well-being of Albertans at risk.”
Related information
- Conference Board of Canada socio-economic Impacts of Canada’s 2030 Emissions Reduction Plan – (April 2025)
- Alberta Electric System Operator’s position on Canadian Energy Regulations
Oh, Canada
We find it endlessly fascinating that most Canadians believe they live in a representative democracy, where aspiring candidates engage in authentic politicking to earn their place in office. So accustomed are Canada’s power brokers to getting their way, they rarely bother to cover their tracks. A careful reading of the notoriously pliant Canadian press makes anticipating future events in the country surprisingly straightforward.
Back in December, when Pierre Poilievre was given better than 90% odds of replacing Prime Minister Justin Trudeau—and Mark Carney was still just an uncharismatic banker few had heard of—we engaged in some not-so-speculative dot-connecting and correctly predicted Carney’s rise to the top spot. Our interest was driven by the notoriously rocky relationship between Ottawa and the Province of Alberta, home to one of the world’s largest hydrocarbon reserves, and how Carney’s rise might be a catalyst for resetting Canada’s energy trajectory. In a follow-up article titled “The Fix Is In,” we laid out a few more predictions:
“Here’s how the play is likely to unfold in the weeks and months ahead: Carney will be elected Prime Minister on April 28 by a comfortable margin; [Alberta Premier Danielle] Smith will trigger a constitutional crisis, providing cover for Carney to strike a grand bargain that finally resolves longstanding tensions between the provinces and Ottawa; and large infrastructure permitting reform will fall into place. Protests against these developments will be surprisingly muted, and those who do take to the streets will be largely ignored by the media. The entire effort will be wrapped in a thicket of patriotism, with Trump portrayed as a threat even greater than climate change itself. References to carbon emissions will slowly fade…
In parallel, we expect Trump and Carney to swiftly strike a favorable deal on tariffs, padding the latter’s bona fides just as his political capital will be most needed.”
The votes have barely been counted, yet the next moves are already unfolding…
“Alberta Premier Danielle Smith says she’ll make it easier for citizens to initiate a referendum on the province’s future in Canada, after warning that a Liberal win in Monday’s election could spur a groundswell of support for Alberta separatism. Smith said on Tuesday that a newly tabled elections bill will give everyday Albertans a bigger say in the province’s affairs.
‘(We’re giving) Albertans more ways to be directly involved in democracy, and to have their say on issues that matter to them,’ Smith told reporters in Edmonton.
If passed, the new law would dramatically lower the number of signatures needed to put a citizen-proposed constitutional referendum question on the ballot, setting a new threshold of 10 per cent of general election turnout — or just over 175,000, based on Alberta’s last provincial election in 2023.”
“US President Donald Trump said on Wednesday that Canadian Prime Minister Mark Carney is looking to make a trade deal and will visit the White House within the next week. Trump said he congratulated Carney on his election victory when the Canadian leader called on Tuesday.
‘He called me up yesterday – he said let’s make a deal,’ Trump told reporters at the White House after a televised Cabinet meeting.”
Remember where you read it first.
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