West Coast Oil Pipeline Proposal Faces Scrutiny Over Cost and Capacity

A new report from the Institute for Energy Economics and Financial Analysis challenges the need for Alberta's proposed West Coast oil pipeline, citing existing pipelines and lower-cost expansions as alternatives. The report compares projected Western Canadian oil production with available pipeline capacity through 2050 under four scenarios, finding that more capacity would be needed only if oil production reaches the regulator's highest forecast.

The report highlights several projects that could add capacity without building a new pipeline, including Enbridge's Mainline Optimization Phase 1 and an expansion of the Express-Platte system. It also notes that combining all near-term projects could add about 550,000 barrels per day to existing capacity.

The proposed West Coast pipeline is expected to cost between C$35.2 billion and C$43.7 billion and carry up to one million barrels of crude oil per day from Bruderheim, Alta., to a deepwater port near Delta, BC. However, the report estimates that transportation fees through the new pipeline would be so high that producers using it could earn US$5 to US$8 (CAD $7 to $11) less left from each barrel than they would without the project.