Canada's Billion-Dollar Pipeline Gamble: A Kodak Moment in Oil

The Canadian oil industry is facing a potential Kodak moment, where it struggles to adapt to changing market conditions. In 1975, Steve Sasson, an engineer at Kodak, built the first digital camera, but the company failed to capitalize on its own innovation and filed for bankruptcy in 2012.

Similarly, Canada is about to make a decision that could leave pipeline assets stranded as global oil demand decreases due to the growing generation of clean electricity. The proposed new pipeline from Bruderheim to a marine terminal on British Columbia's south coast carries more than a million barrels a day and has an estimated cost between $35.2 billion and $43.7 billion.

The ownership structure of this project is significant, with 90% held by government entities, including the federally owned Trans Mountain and the Alberta Petroleum Marketing Commission. This means that taxpayers will bear the majority of the risk if the project fails to deliver strong returns.