While Canada appears to have conceded the point with regard to the demise of the Keystone XL project, let’s not be lulled into thinking that the trade-off is peace on the Canada-U.S. energy front.
One could argue that at least the decision on Keystone XL, as much as it dashes many economic hopes, more or less maintains our current status quo. The potential demise of Line 5, however, would be something much different and the effect would be very immediate and very real.
No doubt the prime minister would prefer of dearth of trade irritants so as to better foster this burgeoning relationship with the new president. Unfortunately, we’re careening headlong into a pretty big one.
Four months ago, Michigan’s governor revoked an easement that allows the Line 5 pipeline to run through the Straits of Mackinac. That decision gave Enbridge Energy a deadline of May to shut its pipeline down and, as of now, that clock is still ticking.
This issue may not be on the radar for many Canadians, but, absent some resolution here, it definitely will be. This can narrowly be described as a dispute between Michigan and Enbridge, but the implications go far beyond that.
Line 5 brings approximately 540,000 barrels a day of crude oil and propane from Canada into Michigan before crossing back into Canada at Sarnia, Ontario. From there, products are shipped through Ontario and into Quebec through Line 7 and Line 9.
All told, this system represents over 40 per cent of Ontario’s crude oil supply (and is responsible for all of the jet fuel used at Toronto’s Pearson International Airport) and approximately half of the crude oil used to produce gasoline in Quebec’s refineries.
So that’s thousands of Canadian jobs at stake along with all of the dire consequences that would accompany such a severe energy supply disruption. This is not the sort of matter where we can just stand on the sidelines and hope for the best.
It seems hope is part of Ottawa strategy here — hope that Michigan and Enbridge can come to some sort of agreement. Who knows, maybe that can still happen. But as they say, hope for the best but prepare for the worst.
To that end, it was encouraging to hear the remarks this past week from Natural Resources Minister Seamus O’Regan. In speaking to a Parliamentary committee on the Line 5 situation, O’Regan vowed that the government is “preparing to invoke whatever measures we need to in order to make sure Line 5 remains operational.”
The minister didn’t elaborate on specifics but is likely referring, at least in part, to the 1977 Transit Pipelines Treaty, which stipulates that petroleum products flow unimpeded through the pipelines that connect the U.S. and Canada.
That kind of recourse, however, would be after the fact and ideally we would avoid the situation reaching that point. To that end, this may require more direct intervention from the prime minister himself in the form of convincing President Biden to get involved in finding a resolution.
There’s obviously the risk for some political embarrassment if Trudeau is unsuccessful in that regard, especially given that Trudeau hasn’t seemed able to convince Biden to budge on other important issues. Given the importance of this matter, however, the prime minister has an obligation to try.
That risk carries some political reward, however. This is one of those rare circumstances where the interests of Alberta, Ontario, and Quebec are in alignment — over a pipeline, no less. Perhaps this whole situation could even lead to some further détente between these three provinces when it comes to matters of energy and energy infrastructure. One dares to dream, anyway.
In the meantime, though, we need a full court press from the federal government. Preserving Line 5 needs to be an imperative.