CDN NEWS | 
US NEWS 
The federal and Alberta governments recently released their much-anticipated Memorandum of Understanding (MOU) outlining what it will take to build a pipeline from Alberta, through British Columbia, to tidewater to get more of our oil to markets beyond the United States.
This was great news, according to most in the media: “Ottawa-Alberta deal clears hurdles for West Coast pipeline,” was the top headline on the Globe and Mail’s website, “Carney inks new energy deal with Alberta, paving way to new pipeline” according to the National Post.
And the reaction from the political class? Well, former federal environment minister Steven Guilbeault resigned from Prime Minister Carney’s cabinet, perhaps positively indicating that this agreement might actually produce a new pipeline. Jason Kenney, a former Alberta premier and Harper government cabinet minister, congratulated Prime Minister Carney and Premier Smith on an “historic agreement.” Even Alberta NDP Leader Naheed Nenshi called the MOU “a positive step for our energy future.”
Finally, as Prime Minister Carney promised, Canada might build critical infrastructure “at a speed and scale not seen in generations.”
Given this seemingly great news, I eagerly read the six-page Memorandum of Understanding. Then I read it again and again. Each time, my enthusiasm and understanding diminished rapidly. By the fourth reading, the only objective conclusion I could reach was not that a pipeline would finally be built, but rather that only governments could write an MOU that no Canadian could understand.
The MOU is utterly incoherent. Go ahead, read it for yourself online. It’s only six pages. Here are a few examples.
The agreement states that, “Canada and Alberta agree that the approval, commencement and continued construction of the bitumen pipeline is a prerequisite to the Pathways project.” Then on the next line, “Canada and Alberta agree that the Pathways Project is also a prerequisite to the approval, commencement and continued construction of the bitumen pipeline.”
Two things, of course, cannot logically be prerequisites for each other.
But worry not, under the MOU, Alberta and Ottawa will appoint an “Implementation Committee” to deliver “outcomes” (this is from a federal government that just created the “Major Project Office” to get major projects approved and constructed) including “Determining the means by which Alberta can submit its pipeline application to the Major Projects Office on or before July 1, 2026.”
What does “Determining the means” even mean?
What’s worse is that under the MOU, the application for this pipeline project must be “ready to submit to the Major Projects Office on or before July 1, 2026.” Then it could be another two years (or until 2028) before Ottawa approves the pipeline project. But the MOU states the Pathways Project is to be built in stages, starting in 2027. And that takes us back to the circular reasoning of the prerequisites noted above.
Other conditions needed to move forward include:
The private sector must construct and finance the pipeline. Serious question: which private-sector firm would take this risk? And does the Alberta government plan to indemnify the company against these risks?
Indigenous Peoples must co-own the pipeline project.
Alberta must collaborate with B.C. to ensure British Columbians get a cut or “share substantial economic and financial benefits of the proposed pipeline” in MOU speak.
None of this, of course, addresses the major issue in our country—that is, investors lack clarity on timelines and certainty about project approvals. The Carney government established the Major Project Office to fast-track project approvals and provide greater certainty. Of the 11 project “winners” the federal government has already picked, most either already had approvals or are already at an advanced stage in the process. And one of the most important nation-building projects—a pipeline to get our oil to tidewater—hasn’t even been referred to the Major Project Office.
What message does all this send to the investment community? Have we made it easier to get projects approved? No. Have we made things clearer? No. Business investment in Canada has fallen off a cliff and is down 25 per cent per worker since 2014. We’ve seen a massive outflow of capital from the country, more than $388 billion since 2014.
To change this, Canada needs clear rules and certain timelines for project approvals. Not an opaque Memorandum of Understanding.
Share This:
