Alberta in ‘crisis’ over low oil price: Prime Minister Justin Trudeau
The Canadian PressIndustry Energy
CALGARY – Prime Minister Justin Trudeau says Alberta is in a crisis as the province’s oil is being sold at a discount of about $45 a barrel.
Speaking in Calgary as pro-oil protesters shut down part of the city’s downtown, Trudeau says he understands people in Alberta are having a tough time.
Alberta Premier Rachel Notley says the oil price gap is costing the Canadian economy $80 million a day.
The province’s oil is selling much lower than West Texas Intermediate in the United States due to a lack of pipeline capacity to move a growing glut of it to markets.
Trudeau says the federal government is doing what it can to get the Trans Mountain pipeline expansion built, which would triple its capacity to carry oil to tankers on the west coast.
He says his government is also allowing companies to write down capital investments to help the oil patch and he’s meeting with industry officials to see what else Ottawa can do.
“There is no question that folks in Alberta, folks here in Calgary, are living through extremely difficult times. This is very much a crisis,” Trudeau said Thursday following an affordable housing announcement.
“When you have a price differential that’s up around $42, $50 even, that’s a massive challenge to local industry, to the livelihood of a lot of Albertans. I hear that very, very clearly.”
Notley has appointed three experts to work with the energy industry to address the oil price gap. Cenovus Energy and Canadian Natural Resources have called for government-imposed temporary cuts until the oil glut clears up, but others including Suncor Energy and Husky Energy have rejected the idea.
Notley and Trudeau were not scheduled to meet during his visit to Calgary but Notley says she is travelling to Ottawa next week to discuss the issue.
Trudeau said Alberta’s economic challenges stem from a “horrific confluence of events.
“There are many things that are beyond our control here, whether it’s the refineries down for maintenance or whether it’s what’s happening overseas around oil prices or whether it’s the fact that we are constrained and have been for a long time to sell 99 per cent of our oil to the U.S,” he said.
“We are working very hard to change that.”
The federal government bought Trans Mountain and its expansion project for $4.5 billion last summer only to have the Federal Court of Appeal strike down its approval, citing inadequate Indigenous consultation and failure to consider impacts on marine environment.