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Why is Canada expanding the Trans Mountain Pipeline?

Why Expand - override
The Trans Mountain Pipeline makes us less reliant on the United States. That's one of many crucial reasons the expansion matters. [1:30]

Gaining new customers helps Canada

Canada and the United States have a unique trading relationship. Our shared border means we’re reliant on one another for various economic activities, and both countries have benefited from our strong economic ties. But relying on a single customer for our energy products is problematic for a number of reasons:

  1. Having one customer forces us to sell our energy resources at a discounted price, which means less money for what’s important to all Canadians – health care, schools, roads, public transit and hospitals.

  2. While the U.S. will continue to be the largest customer for Canadian oil, our southern neighbour is producing more and more oil domestically. That makes it a less reliable market.

  3. Depending on a single customer is not a smart way for any industry to operate.

Expanding the Trans Mountain Pipeline gives us the ability to sell our energy resources to multiple international customers at higher market prices – and transport them in a way that creates fewer greenhouse gas emissions.

Canada loses money daily by not entering global markets

It’s been more than 60 years since we last built an oil pipeline to Canada's west coast. We lose money – a lot of money – every day that this pipeline expansion is delayed. Applying the methodology from a February 2018 Scotiabank report to October 2018 oil prices, the Government of Alberta estimates the cost to the Canadian economy at roughly $80 million dollars a day. That’s why increased pipeline capacity to bring oil to markets overseas is needed now. So we can get a higher price for our products to fund the things that matter most to Canadians.

Canadian dollar
Fund what matters
Global markets

Diversifying energy markets increases revenue

If there's only one possible market to buy your products, that market has all the leverage – and you're forced to take the price they offer. Only by diversifying our energy markets beyond the United States can we maximize the return we receive on oil products. Without the Trans Mountain expansion in place, revenue that should be staying in Canada goes south of the border.

Every Canadian has a stake in getting top dollar for our resources. We need to access new markets to make that happen.


the facts

Oil and gas contributes to the Canadian economy

Canada is the seventh largest oil producer in the world. There is no doubt the oil and gas sector adds a lot of value to the Canadian economy. But compared to other areas, exactly how much does our oil and gas sector contribute to the economy? A lot.

A recent article by ATB Financial’s Economics + Research Team, using Statistics Canada data, compares the auto industry to the oil and gas sector. The article points out “that oil and gas extraction is the larger of the two industries. In fact, it’s not even close with oil and gas accounting for $114 billion of Canada’s GDP last year compared to $18 billion generated by the auto sector.”

While that $18 billion is significant, the oil and gas sector is worth over six times more than what the auto sector brings to the table. Meanwhile, “the economic output of the oil and gas sector has been rising in recent years while the growth profile for the auto sector has been relatively flat.”

If we continue to believe that “the auto sector is the lifeblood of the Canadian economy,” that means we’re ignoring the significant contribution oil and gas makes to Canada’s economy – employing more people than the auto sector, creating more jobs and providing more government revenues for our roads, schools and hospitals.

Canadian leaders show their support