The Alberta government has set an ambitious timeline for the potential construction of a new West Coast oil pipeline, according to analysts at CIBC World Markets. The province aims to submit a proposal to the federal major projects office by July 1, have it designated a project of national interest by Oct. 1, and commence construction as early as Sept. 1, 2027. Oil flow could begin around 2033 or 2034, as stated by a provincial official during a recent media briefing.
CIBC analysts Robert Catellier and Rogan Anantharajah described the timelines as optimistic, reflecting a best-case scenario. The announcement of these targets followed the finalization of an agreement between Alberta and Ottawa on increasing the market price of carbon to $130 a tonne by 2040.
The Alberta government is leading the pipeline application process as no private-sector entity has yet come forward to share the risks and costs involved. While some pipeline companies are considering participation in the project, several conditions still need to be met to support the substantial investments required.
The proposed pipeline aims to transport up to one million barrels per day of oilsands crude to the West Coast, potentially more than doubling the current volumes reaching Asian markets. The preference is for a northern port option due to its shorter shipping distance to Asia.
However, there are still unresolved issues, including negotiations with British Columbia, consultations with Indigenous groups, and clarifications on the ban on oil tanker loading on the northern B.C. coast. Despite these challenges, the construction timeline announcement has been seen as a positive development by ATB Financial chief economist Mark Parsons, who believes it will increase pressure to move the project forward.
ATB estimates that the Pathways project and the planned pipeline expansions could significantly impact Canada’s and Alberta’s GDP between 2027 and 2035, potentially providing a substantial boost to the economic outlook of both regions.
