Canada takes a page from the Saudi oil playbook
CNQ•Canada plans to fast-track approvals for the Pacific Link pipeline, a proposed 1-million-barrel-per-day route to the west coast estimated to cost C$35.2 billion to C$43.7 billion. The project would help diversify oil exports, about 90% of which currently go to the United States.
1. New export route
Canada is seeking to expand energy exports and reduce reliance on the United States as its main oil customer. Prime Minister Mark Carney announced plans to fast-track approvals for the Pacific Link pipeline, which would connect Alberta’s oil hub to the west coast and carry 1 million barrels per day.
2. Cost and capacity
The proposed line would broadly follow the route of the Trans Mountain system, which has capacity of 890,000 barrels per day. The government estimates the project will cost C$35.2 billion to C$43.7 billion, with taxpayers expected to fund most of it. Energy Minister Tim Hodgson said construction is expected to begin next September.
3. Export growth outlook
The United States accounts for roughly 90% of Canada’s oil exports. Hodgson said oil production could increase by 2 million to 2.5 million barrels per day over five to seven years, while liquefied natural gas exports could reach 50 million metric tons annually by 2030, up from about 14 million today. Commodity Context founder Rory Johnston forecasts more modest oil production growth of 100,000 to 150,000 barrels per day annually over the next decade.
