Alberta exploring at least two oil pipeline projects to Northwest Territories – by Yadullah Hussain (National Post – April 26, 2013)

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Hemmed in by unco-operative jurisdictions to the south, west and east, Alberta is looking upward, exploring at least two new northern projects that would help the province get its oil to tidewater, making it available for export to overseas markets.

The Alberta government says it is in “serious talks” with the Northwest Territories to build an oil pipeline connecting the oil sands to the northern hamlet of Tuktoyaktuk, near the Beaufort Sea.

“We have been approached by the government of the Northwest Territories and we are engaged in a conversation with them because they have immense resources as well and are about to take responsibility for their own resources,” Ken Hughes, Alberta’s Minister of Energy told the National Post.

Alberta has hired Canatec Associates International to assess the project’s feasibility, at a cost of $50,000. The Calgary-based consultancy, which specializes in the offshore and Arctic petroleum business, is expected to submit its findings before the end of the year.

Frustrated by Washington’s continuing delays in approving proposals for the U.S.-bound Keystone XL pipeline, Alberta is also getting negative signals from its western border. B.C. NDP leader Adrian Dix, who appears poised to win the province’s May 14 election, opposes two major plans to move increasing amounts of Alberta oil by pipeline to the West Coast: the expansion of the existing TransMountain line to Vancouver and the proposed Northern Gateway line to Kitimat.

Even B.C.’s current Liberal premier, Christy Clark, has shown herself somewhat hostile to the Northern Gateway plan. Proposals to move oil east to the Atlantic by pipeline have received a comparatively warmer political reception, although there are signs of rapidly growing opposition in Quebec.

The result is that Alberta has been forced to explore more speculative and costlier northern fronts to get its oil out.

The discussions would seem to be part of Alberta’s efforts to build alliances with friendlier jurisdictions, including Manitoba and Saskatchewan, as a way to at least develop competitive leverage against less-accommodating regions, such as B.C., Quebec and the U.S.

“There is a negotiation element to all of this — if you have more options, it does help,” said Robert Roach, vice-president of research at the Calgary-based Canada West Foundation. “I am not sure how many people outside Alberta realize we are running up against a [pipeline capacity] wall around 2016, when we will have barrels of oil we can’t move.”

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