TD Report Warns Pipeline Estimates May Be Overly Optimistic

A new oil pipeline to the West Coast could bring significant economic benefits to Canada and Alberta, but estimates of its impact may be overly optimistic.

A report from TD Economics suggests that a million-barrel-a-day pipeline would boost the national economy by 0.6% in the 2040s, with Alberta's GDP increasing by 3.5%. However, economists Marc Ercolao and Likeleli Seitlheko warn that these figures may be overly ambitious, and using more conservative assumptions, they estimate a 0.3% boost nationally and a 2% increase provincially.

The pipeline would enable Canada to export an additional 20% of its oil to Asia, with the majority going to China. However, TD economists note that Asian demand for Canadian barrels may flatten over time as electric vehicle adoption and cleaner energy sources become more prevalent.