‘A key test’: Canadian oil executives await Trudeau’s grand bargain on pipelines
Many in Canada’s business community will be watching if Prime Minister Justin Trudeau’s pipeline decisions, expected as early as Tuesday, deliver on his “grand bargain” — carbon pricing for pipeline approvals.
“This is a key test of whether the Trudeau government is going to balance the needs of a resource-based economy with those of a climate agenda,” said John Manley, president and CEO of the Business Council of Canada.
If Trudeau does, there will be wrath – from environmentalists and aboriginals who will never compromise, to proponents and investors who didn’t get the infrastructure they needed.
But no better option than to seek a middle ground has emerged, and it goes some way to restoring the national interest as the key determinant of infrastructure decisions. At this time, the national interest involves supporting a resource-based economy that takes environmental protection seriously. Otherwise, the recession that is devastating Alberta and other resource producing regions will keep dragging down the country, and investment will keep moving elsewhere.
According to widespread expectations, Trudeau’s Liberal government will rule this week on two proposed Enbridge Inc. pipelines – the replacement of the aging Line 3 and the future of the stalled Northern Gateway. A decision on whether the Kinder Morgan Trans Mountain expansion, due by Dec. 19, could also come any day.
Line 3 and the Trans Mountain expansion are expected to get the green light. Northern Gateway could be permanently sidelined.
Manley said Canada’s business community, including the business leaders represented by his organization, have signed on to carbon pricing as long as it means getting resources out of the ground and to their customers.