Ottawa dials down support for Northern Gateway pipeline, citing ‘huge challenges’ – by Claudia Cattaneo (National Post – December 1, 2012)

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CALGARY — With new options firming up to pipe Western Canadian oil to Eastern Canada, and a decision in the United States on the Keystone XL pipeline months away, Ottawa appears to be dialing down its support for the controversial Northern Gateway pipeline through northern British Columbia.

In a discussion Friday with energy industry leaders in Calgary, Joe Oliver, Canada’s Minister of Natural Resources, said Ottawa is still very keen to develop new markets for Canada’s oil, but is also keeping an eye on public opinion.

“If we don’t get people on side, we don’t get the social licence — politics often follows opinion — and so we could well get a positive regulatory conclusion from the joint panel that is looking at the Northern Gateway, but if the population is not on side, there is a big problem,” he said at the Canada Energy Summit hosted by the Economic Club of Canada.

“We understand there are huge challenges there, and looking at that and how we can deal with it and looking at all the alternatives at the same time.” It’s a new tone for the minister, who during a visit to Alberta last summer said: “Gateway, in our opinion, is in the national interest.”

Mr. Oliver said he supports the eastern option because refineries can purchase crude at lower prices than they are paying now to foreign producers, there is opportunity to create jobs, and even reduce the price of fuel.

“In addition there is the potential advantage that people see the direct economic advantage to them and build a broad national consensus about development,” he said.

Enbridge Inc., the proponent of Northern Gateway, is also proposing the reversal of Line 9 between Sarnia and Montreal.

It has received regulatory approval for the first part and will seek approval for a larger, second phase by the end of the year, with a ruling expected in 2013. The pipeline would be connected to Enbridge’s Mainline system and carry 300,000 barrels a day of Western Canadian oil to eastern consumers by 2014.

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