Oil Export Expansion Top Priority for Federal Government

Earlier this month Natural Resources Minister Joe Oliver said that Canada believes the United States will ultimately approve TransCanada Corp's proposed Keystone XL pipeline, which Washington put on hold in November amid environmental opposition. Keystone XL would carry oil sands-derived crude from northern Alberta to numerous refineries on the Gulf of Mexico.

The $7 billion oil pipeline to Texas from Alberta, as well as a new pipeline to Canada's West Coast, is crucial to preventing a costly bottleneck in export capacity over the next four to seven years as oil sands production jumps.

The Canadian Association of Petroleum Producers, the industry's main lobby group, has said production could approach export capacity as early as 2015 without new pipelines and that could slow investment. Expansions to current systems could push that date out to 2018, but the issue remained crucial and shows the need to move forward with plans to streamline approvals of major projects.

Minister Oliver has said that the Keystone XL pipeline delay shows the importance of diversifying Canada's oil exports, in particular by developing pipelines to the Pacific Coast, which would allow major shipments to Asia for the first time.

Minister Oliver is focusing on not only ensuring that projects are able to proceed.  He also wants to reduce red tape which bogs down essential energy infrastructure projects. He has established regulated timelines for reviews, developed a process that gives enough time for a comprehensive review but is not overly onerous and has better aligned federal and provincial processes.

- Beverly Brooks

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