Canada, British Columbia sign pact to fast-track energy corridors

Canada's federal government has signed an agreement with British Columbia to speed construction of energy and trade corridors throughout the province, including a new oil pipeline to send crude to Asian markets.

"The scale of these opportunities is absolutely unprecedented, and we are committed that our agreement will provide the model for the future across the country," Mark Carney, the prime minister of Canada, said during a July 2 press conference in Vancouver.

At issue is a plan by Alberta to start construction in 2027 on a new 1 million barrel/day crude oil to the Pacific Coast. Alberta is slated to submit its application to Canada's Major Projects Office on July 2, with a decision due by October 2026.

The memorandum of understanding between the Canadian federal government and British Columbia noted that the federal government has the authority to approve and build pipelines across provincial boundaries.

"This agreement doesn't require us to support any pipeline proposal from Alberta," British Columbia Premier David Eby said at the press conference. "However, as I have said before, we recognize our constitutional position, and we do not have the authority to stop a new pipeline."

The agreement ensures that a ban on tankers on Canada's North Coast will continue and that British Columbians are fairly compensated for the environmental risks of the new pipeline project, Eby said.

The agreement also recognizes a separate plan to increase the capacity of the Trans Mountain Pipeline to 1.2 million b/d, up from 890,000 b/d. The deal provides a federal commitment to support capital costs incurred by British Columbia related to the project and ensures the province gets a fair share of additional fiscal and economic benefits from the expansion.

The agreement also supports the LNG Canada Phase 2 project, the Ksi Lisims LNG and Prince Rupert Gas Transmission project, the Cedar LNG floating project, and the Woodfibre LNG project.

"Canada commits to providing regulatory coordination, potential financing tools and trade advocacy needed to move these projects from approval to construction to operation," the agreement said regarding the LNG projects.

The agreement also supports projects related to critical minerals, steel manufacturing, lumber, ports, transportation, electric transmission, and carbon markets.