Call it the final nail in the coffin of the Northern Gateway pipeline, even as Canada faces crippling US energy tariffs.
That’s because Environment Minister Steven Guilbeault on Tuesday quietly terminated the environmental assessment of a proposed $11-billion oil refinery in British Columbia aimed at processing 200,000 barrels per day of Alberta oil flowing off the ill-fated Northern Gateway pipeline.
First proposed in 2016, Pacific Future Energy had envisioned the 150,000 barrel per day refinery, near Kitimat, as a way to export refined petroleum products like gasoline, diesel and jet fuel to Asia.
It would have operated in conjunction with a separate 200,000 bpd diligent recovery unit near Edmonton.
The project was to be fed from the now-defunct Northern Gateway pipeline, which was originally intended to transport 500,000 bpd of diluted bitumen from Alberta to the West Coast — and 200,000 bpd of natural gas liquids back again — before it was blocked by the federal government in 2016.
The cancellation of the Kitimat refinery is a significant, but inevitable, setback for those who had hoped to see new avenues for Alberta’s landlocked oil reach international markets. The project had garnered support from high-profile figures, including former Alberta cabinet minister and federal opposition leader Stockwell Day, who served on Pacific Future’s board of directors.
The company’s CEO, Samer Salameh, notified the Impact Assessment Agency of Canada (IAAC) on December 3 that Pacific Future Energy no longer intended to proceed with the refinery. Newly released documents reveal that Minister Guilbeault subsequently confirmed the termination of the environmental review effective February 11.
“In your response on December 3, 2024, you confirmed that Pacific Future Energy Corporation does not intend to carry out the project,” Guilbeault wrote to the company. “This letter provides you with notification that I have terminated the environmental assessment for the project.”
The project had been stalled for years, with limited public updates from the company. In 2019, the federal government introduced the Impact Assessment Act (IAA), replacing the Canadian Environmental Assessment Act with a more stringent regulatory framework that places greater emphasis on climate considerations.
Because Pacific Future Energy initially submitted its project description in 2016, it fell under the previous rules. However, Minister Guilbeault made it clear that any attempt to revive the project would require a new application under the updated environmental regulations.
The refinery’s cancellation adds to a series of setbacks for oil export projects on Canada’s West Coast. The Northern Gateway pipeline, originally proposed by Enbridge to transport Alberta’s oil to the Pacific, was rejected by the Trudeau government in 2016 after years of controversy and opposition from Indigenous and environmental groups.
Pacific Future Energy had positioned its refinery as a way to bypass those concerns by refining the oil domestically before export.
The proposed facility would have used carbon capture and storage (CCS) technology to minimize emissions, alongside a 200-megawatt gas-powered plant.
Day’s role as a key figure on the company’s board added a political dimension to the project. Day, a former federal minister of international trade who was previously Alberta’s finance minister and solicitor general under Premier Ralph Klein, had championed trade ties with Asia and supported initiatives to move Canadian oil to global markets.
While Pacific Future Energy still lists various oil, solar, and renewable energy projects in Canada, the US, Lebanon, and Iraq on its website, it had no statement on the project’s cancellation. The Western Standard has reached out to Day for comment.
