Canada's Federal Government Enacts De Facto Toll on Alberta Oil

The recent agreement between Canada and British Columbia has sparked controversy over its implications for internal trade and constitutional authority. The Cooperative Prosperity Agreement, signed by Prime Minister Mark Carney and B.C. Premier David Eby on July 2, commits Ottawa to negotiating a payment framework with the province. This move has been criticized as 'extortion, plain and simple' by economist Jack Mintz.

The agreement stems from a decades-old proposal made by then-Premier Christy Clark in 2012, which would have seen Kinder Morgan pay up to $50 million per year for 20 years. B.C.'s current government has continued this effort, with Premier Eby now seeking revenue from Alberta's petroleum economy.

Economist Marco Navarro-Génie argues that Ottawa is complicit in creating this plan, rather than simply observing it. He points out that the agreement commits the federal government to negotiating a payment scheme for exercising its exclusive authority over interprovincial pipelines.