ANALYSIS: Ford and Smith's pipeline proposal has a Manitoba problem

CALGARY — With Alberta Premier Danielle Smith and Ontario Premier Doug Ford unveiling plans for a new pipeline from Alberta to Ontario on Monday, questions are already being raised about what obstacles stand in the way of turning the proposal into reality.One of the biggest may be Manitoba.Smith and Ford announced the Northern Shield Energy Corridor, a proposed 3,300-kilometre pipeline stretching from Hardisty, Alberta, to Sarnia, Ontario. The project would initially carry up to 500,000 barrels of oil per day, with the potential to expand to 800,000 barrels.The proposed route would cross Manitoba, with maps released by the provinces showing the corridor running through Winnipeg before continuing east toward Ontario's refinery hub in Sarnia..Saskatchewan Premier Scott Moe has already expressed support for the proposal, saying it would strengthen Canadian “energy security and create good-paying jobs.”The new proposal follows a memorandum of understanding signed last year by Alberta, Ontario and Saskatchewan to explore a west-east energy corridor.However, Manitoba Premier Wab Kinew did not sign onto that agreement.In a statement issued Monday, a Manitoba government spokesperson said major nation-building projects need to be built the right way.“That’s why we’re continuing to work directly with Northern communities, indigenous nations, and the Manitoba Crown Indigenous Corporation as we advance discussions around Churchill’s future. Those conversations will continue because lasting economic development is built in partnership,” the spokesperson said.At his joint press conference with Smith in Calgary, Ford acknowledged Manitoba could benefit from the project, suggesting a future extension north to the Port of Churchill..Alberta backs proposed new west-east pipeline to supply Ontario refineries.“We’ll work something out,” Ford said.“I’m 100% behind putting a pipeline up to Churchill and getting an icebreaker and starting delivering it around the world.”Manitoba’s government is currently pushing the Churchill Plus project — a federally backed plan to expand the province’s 95-year-old former grain port into an all-season trade hub for Canadian energy and natural resources — which was listed as a “transformative project” by the federal government’s Major Projects Office in September.Kinew has touted the project as a way to reduce reliance on the US and bolster national security while finding an alternative route for Canadian goods — in particular oil and gas — to reach international markets. The federal and provincial governments have already committed more than $260 million toward port upgrades, rail improvements, road infrastructure and studies examining year-round shipping opportunities through Hudson Bay.That potential northern expansion may ultimately determine whether Manitoba embraces the Alberta-Ontario pipeline proposal.However, indigenous consultation will play a major role in determining the project's viability.Smith and Ford have said their respective governments will now seek support from Saskatchewan and Manitoba while working to bring 77 indigenous communities onside..In June, Kinew announced that there was no opposition among indigenous leaders in northern Manitoba to the liquefied natural gas (LNG) pipeline he hopes to see built as part of the efforts to expand the Port of Churchill but it remains to be seen if First Nations leaders will react to the Northern Shield proposal in the same light. Some leaders may now be questioning whether Alberta and Ontario announcing the project before meaningful consultations occurred has created the perception that indigenous communities are being asked to endorse a plan they had little role in shaping.A pipeline designed primarily to move Alberta crude to Ontario refineries also offers limited direct economic benefits to Manitoba.By contrast, a broader corridor linked to Churchill Plus could provide northern economic development, indigenous participation and future export opportunities that may be more attractive to the province.There are also broader economic questions surrounding the proposal..SK, MB Premiers strike deal to expand exports through Port of Churchill.While some supporters are touting Northern Shield as a modern version of the cancelled Energy East pipeline — which was designed to transport up to 1.1 million barrels of oil per day from Alberta and Saskatchewan to refineries and export terminals in Quebec and New Brunswick — others such as Richard Masson, former chief executive officer of the Alberta Petroleum Marketing Commission, remain skeptical. Speaking on Courtney Theriault’s radio show on Monday, Masson described the proposal as a “very low probability of success idea that is being floated,” arguing there are “many, many barriers” standing in its way.Masson noted that while Northern Shield would be smaller than Energy East in terms of capacity, the Sarnia-area refineries it is intended to serve are already “served completely by Western Canadian oil through the Enbridge system.”“It’s a duplication of an existing system that’s been operating effectively for decades,” Masson said.He also pointed out that export infrastructure in the Sarnia region is limited and argued the refineries there primarily process medium and light crude rather than diluted bitumen from Alberta’s oil sands.“They don't have the capacity to process the new oil that would come on this pipeline if it was diluted bitumen, which is what we are producing these days,” he said.Regardless of those concerns, whether Northern Shield ultimately moves from concept to construction may depend less on Alberta and Ontario than on whether Kinew and Manitoba see enough value in the project to become an active partner.

ANALYSIS: Ford and Smith's pipeline proposal has a Manitoba problem

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