BC gas prices and Bill 12

The recent Alberta election resulted in a change of government from the NDP to the United Conservative Party (UCP) under  the leadership of now Premier Jason Kenney. 

This election result has a unique BC connection, given one of the promises from Premier Kenney was that the UCP would immediately proclaim Bill 12.

For those of you unfamiliar with Bill 12, it is referred to as the “turn off the taps” legislation intended to enable the Alberta government to have the power to restrict the flow of oil into British Columbia.

The bill is a retaliatory measure against the BC NDP government, who continue to oppose the Trans-Mountain pipeline expansion project. 

How would Bill 12 work? 

Not by physically shutting down any pipeline.

Rather, requiring that Alberta companies who currently export petroleum products to have special provincial licenses.

The licenses in question would allow for the government to impose restrictions on what products and quantity of product may be approved for export.

Although the Alberta government has indicated it will not immediately use this legislation, the BC government has indicated they will challenge the constitutional validity of this legislation and are in the process of seeking an injunction in the courts.

A couple of questions are often raised.

What effect could this have on gas prices in BC? 

If completed, how would the the expanded Trans-Mountain pipeline impact BC gas prices?

Here is the challenge.

Currently the Trans-Mountain pipeline has to carry a range of different products within the same pipeline.

In other words, refined products, such as gasoline that is used by BC drivers, passes through the same pipeline as the unrefined products, such as diluted bitumen. 

Within the industry, this process is called “batching” and the Trans Mountain pipeline is the only one remaining in North America to still use this inefficient process.

If built, the expanded new section of the Trans-Mountain pipeline would exclusively carry what is known as “heavy oils” such as diluted bitumen.

This allows for the existing section of the Trans-Mountain pipeline to be used exclusively for refined products that include gasoline.

It is expected that the increased supply and capacity of gasoline as a result of this project being completed will create lower gas prices, not withstanding increases from the carbon tax.

It would also have the positive benefit of reducing our energy reliance on American refined fuel.

The irony here is that some of the same elected officials who support increasing the carbon tax on fossil fuels to, as Mr. Trudeau has stated, “make better choices”, also support increasing the gasoline supply to protect drivers from being gouged at the pumps.

Last week, the Liberal Government stated that they “can’t guarantee it will have a decision on the proposed Trans Mountain pipeline expansion prior to the next election”. 

This despite the fact Mr.Trudeau spent $4.5 Billion to purchase the Trans-Mountain pipeline. calling the expansion “to be in Canada’s national interest.”

My question to you this week:

Do you support the expanded Trans-Mountain pipeline project?

I can be reached at Dan.Albas@parl.gc.ca or call toll free 1-800-665-8711.