Alberta readies to cut B.C. fuel shipments in Canada pipeline row
Canada's Alberta province onMonday edged closer to cutting off fuel shipments to neighboringBritish Columbia in an escalation of a row over the stalledC$7.4 billion ($5.9 billion) expansion of the Kinder MorganCanada Trans Mountain pipeline.
The project has pitted Ottawa and Alberta against BritishColumbia (B.C.), and could turn into a constitutional crisis,derail Prime Minister Justin Trudeau's energy strategy and dentbusiness confidence.
Kinder Morgan said earlier this month it was halting mostwork on the Trans Mountain expansion project, which was approvedby Canada in 2016 but has been beset by legal tussles. Theexpansion of the pipeline, which extends from Alberta to theB.C. coast, is desperately needed by oil-rich Alberta, whichwants to export more of the crude it produces.
But it is vehemently opposed by B.C., which has pledged newenvironmental rules and a legal challenge, putting constructionat risk.
Seeking to put pressure on its neighbor, Alberta introducedlegislation on Monday that gives it the power to control whatproducts flow through export pipelines, allowing it toprioritize more valuable crude oil shipments over refined fuels,like gasoline.
That could hurt B.C., which uses Alberta's refined fuel.Trans Mountain is the only pipeline in North America thatcarries both crude and refined fuel products.
"We did not start this fight, but let there be no doubt wewill do whatever it takes to build this pipeline," AlbertaPremier Rachel Notley told reporters.
B.C. environment minister George Heyman said in responsethat his government was "prepared to defend British Columbians'interests with every legal means available."
On Sunday, Trudeau pledged financial aid and said hisgovernment would draft legislation to reaffirm federaljurisdiction over the issue.
Those measures have the aim "of making sure that one, thatthis pipeline will be built and two, that all of the investorsinvolved know that we take this seriously and they can beconfident it will go through," said a source close to thegovernment on Monday.
Kinder Morgan Canada's shares closed up 13 Canadian cents atC$17.37 on the Toronto Stock Exchange.
RESTRICTING SHIPMENTS
Under the new legislation, Alberta can ask companiesexporting energy products to seek a license, allowing thegovernment to impose restrictions on transport by pipeline, railand truck.
The province will only enforce the new rules if deemednecessary and any move may be tied to the outcome of a plannedMay 31 decision by Kinder Morgan on whether construction will goahead, Notley said.
Aboriginal and municipal leaders held a news conference inthe B.C. port city of Vancouver to reiterate their opposition tothe project, which they say poses a grave environmental risk.
"They can call in the Canadian army, ok, I'll stand infront," said Amy George, a First Nation elder. "I'm going tostand up for my grandchildren, for my waters, for my land andfor my air."
(Additional reporting by Andrea Hopkins in Ottawa; Editing byDavid Gregorio and Rosalba O'Brien)