Arctic route for Alberta oil could trump stalled B.C. pipeline projects – by Justin Ling (National Post – September 5, 2014)

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Alberta’s plan to get its landlocked oil to overseas markets by way of Arctic shores might just become a reality — and sooner than the stalled Northern Gateway or Keystone XL projects.

The plan, until recently dismissed as dubious by some skeptics, may have finally found the right combination of winning conditions: a hunger for resource development in Yellowknife, a desperate need to find new markets for oil-sands bitumen, an aggressive push from the federal government to reduce environmental oversight in the territory, and the changing northern climate.

One of the biggest barriers for the so-called Arctic Gateway plan has long been the sheer logistical nightmare of moving the oil to a port along the Beaufort Sea.

But a technical report commissioned by the Alberta government last year, which has just been released, suggests a few novel ideas on how to transport the bitumen. The report’s authors — of Arctic petroleum consultants Canatec Associates International Ltd. — propose three potential options, all of which the report deems technically feasible. A pilot project using small test shipments could be started as early as next year, it said.

At its most ambitious, a northern pipeline project could make 35 million barrels of diluted bitumen a year available for trans-ocean export. Northern Gateway, by comparison, proposes to ship 190 million barrels a year.

The most basic scenario would see a brand new pipeline built, connecting Fort McMurray, almost as-the-crow-flies, to the far-north port of Tuktoyaktuk.

Yet, at some 2,400 km in length — more than twice as long as the proposed Northern Gateway pipeline to the B.C. coast — it, like Gateway, is bound to draw environmental controversy over possible risks to the territory’s pristine wilderness.

There is also the tricky matter of navigating the iceberg-laden waters of the Beaufort Sea.

But global warming has the potential to reduce many of the risks that, 20 years ago, might have frozen such an idea in its tracks. The report notes that a quickly melting Arctic would improve navigation, extend the shipping season, and decrease the risks associated with increased industrial activity on the permafrost. During those periods when the ice proves impassable, storage facilities could stockpile oil until the icebreakers can again clear the waters.

The report even says that the shrinking ice fields would allow oil tankers to cross the Northwest Passage and allow Albertan oil to reach Europe.

The authors, not to be accused of downplaying the importance of that scheme, write that a shipping route from Tuktoyaktuk to both Pacific and Atlantic markets would “be a revolution in global logistics, equal in impact to the opening of the Suez or Panama Canals.”

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