Canadian Manufacturing

Federal memo says no new pipelines needed until 2025

A memo to the deputy minister of finance says low oil prices mean there is plenty of oil transport capacity in Canada for the time being


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OTTAWA—Alberta Premier Rachel Notley is telling Ottawa to stop “dithering” on pipelines approvals, but an internal federal analysis may indicate why the Liberals are content to consult widely before making a decision.

A memo to the deputy minister of finance says low oil prices mean there is enough transport capacity in Canada without any new pipelines until at least 2025.

The memo, dated last December but obtained this week through the Access to Information Act, also says TransCanada’s proposed Energy East pipeline would have only a marginal impact on the price differential for Canadian producers.

Canadian oil was selling at a $25-per-barrel discount or more in 2012 and 2013 compared to the price for international Brent crude, but that discount has all but disappeared.

The memo says Energy East would reduce the differential by only $1.48 per barrel compared to oil shipped by existing pipelines to the United States.

A spokesman for Energy East says the proposed $15.7-billion pipeline from Alberta to New Brunswick already has long-term contracts with oil shippers, demonstrating the market demand over the coming decades.


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