The Alberta government has outlined an ambitious timeline for the potential construction of a new oil pipeline on the West Coast, but analysts from CIBC World Markets caution that there are significant hurdles ahead. The province aims to submit a proposal to the federal major projects office by July 1, have it designated a project of national interest by Oct. 1, and commence construction as early as Sept. 1, 2027. According to a provincial official, oil flow could start around 2033 or 2034.
CIBC analysts Robert Catellier and Rogan Anantharajah described the timelines as optimistic and based on a best-case scenario. The Alberta government established these targets after finalizing an agreement with Ottawa on increasing the market price of carbon to $130 a tonne by 2040.
One of the remaining agreements to be settled is related to funding the multibillion-dollar Pathways carbon capture project, which is a prerequisite for the pipeline. While no private-sector entity has stepped forward to bear the risks and costs, top pipeline executives are assisting the province with technical aspects and routing options.
The proposed pipeline aims to transport up to one million barrels per day of oilsands crude to the West Coast, significantly increasing access to Asian markets. The Alberta government favors a northern port option due to its proximity to Asia. Negotiations with British Columbia, consultations with Indigenous communities, and the ban on oil tanker loading in northern B.C. are still pending.
B.C. Premier David Eby, coastal First Nations, and environmental groups have reiterated their opposition to any potential relaxation of the tanker ban. ATB Financial chief economist Mark Parsons believes that the clarified construction timelines for the pipeline project are a positive development that should accelerate progress.
ATB estimates suggest that Pathways and the planned pipeline expansions could boost Canada’s real GDP by 1.1% and Alberta’s by 5.1% between 2027 and 2035. Parsons views this as a significant opportunity for Alberta and Canada’s economic outlook.
