I have spent a lot of time in the last few years researching the Trans Mountain Pipeline expansion (TMX) project. Throughout I have always felt confident that good environmental and fiscal sense would prevail, and the pipeline would be built. Given the Federal Court decision I can’t help but start to doubt that confidence. The obvious question to ask is: what happens if the pipeline is not completed? In this blog I ask and answer 15 questions about a world where the TMX fails. The answers do not reassure me and I wonder if the many of the activists who have been fighting the TMX are ready for a world without the expanded Trans Mountain pipeline? To make it easier in the following list “it” means “the failure of the TMX project”. So what did I realize:
- Will it reduce the number of tankers in the Salish Sea: No
- Will it reduce the likelihood of a spill in the Salish Sea: No
- Will it reduce our ability to respond to spills in the Salish Sea: Yes
- Will it reduce the threat to the Southern Resident Killer Whales: No
- Will it increase the amount of oil moved by rail: Absolutely
- Will it increase the likelihood of a rail spill: Absolutely
- Will it increase the cost to transport Alberta oil: Yes
- Will it decrease oil sands developments: Yes, likely
- Will that decrease in oil sands development results in a decrease in global GHG emissions: Absolutely not
- Will it make it harder to fight climate change in Canada: Absolutely
- Will it decrease Canadian prosperity: Yes
- Will British Columbians remain hostage to high oil prices with zero control over supplies: Yes
- Will it reduce the risk to First Nations communities: Absolutely not
- Will it reduce the prosperity of First Native communities: Absolutely
- Who wins and who loses if the TMX doesn’t go through?
– Losers: Canadians, the environment, salmon, the southern resident killer whales and Canada’s fight against climate change -Winners: Activist NGOs, American refinery owners, and foreign dictatorships
The rest of this post are short explanations for my conclusions. The rest of this post is a bit long although the answer to each question has been kept as short as possible. It is a testament to just how bad the outcome is that I couldn’t keep this section short. So many negative consequences will flow from the failure of the TMX.
1) Will it reduce the number of tankers in the Salish Sea: No
As described in my previous post the refineries in the Puget Sound will still need over 645,000 barrels/day (b/d) of crude oil. Currently Cherry Point refinery alone sees 500+ tankers a year and Toresco (a committed shipped on the TMX) has said they want to add 120 tankers a year to their Andeavor facility to make up for an absence of supply. Meanwhile Westridge will still be sending out a few tankers a month. So in the end we will still see 700+ tankers a year coming in and out of the Salish Sea with 620+ of them running the narrower and much more dangerous Rosario Strait.
2) Will it reduce the likelihood of a spill in the Salish Sea: No
I have written in detail about the relative risks associated with the project to the Salish Sea. Any cold-eyed analysis of the relative risks shows that the TMX reduces our regional risks of oil spills. Blocking the TMX will increase the likelihood of a disastrous rail spill that could spell the end of a major fishery or result in the deaths of dozens of innocents. It will put more tankers going through narrower waters with less support from escort tugs. That is a formula for increased risk.
3) Will it reduce our ability to respond to spills in the Salish Sea: Yes
The BC west coast has been chronically under-served for spill response. One of the big gets for BC in the TMX project was a toll on the new fuel transportation to pay for improved spill response. However, if there is no expansion that toll will not be paid and that money disappears. The result is a loss of spill response capability. Right now we are looking at losing $150 million and several spill response bases. Since the funds for the spill response was coming from the private sector there is no obvious way to replace those funds. When a spill occurs the equipment will not be there to address it. So damage will be greater.
4) Will it reduce the threat to the Southern Resident Killer Whales: No
I wrote about this in my last post. If you look at the entire Salish Sea, and not simply the Canadian side of the border, then you realize that the loss of the TMX will likely increase the risks to the southern resident killer whales, not decrease those risks. Foreign-flagged ships with lower safety standards will be coming in to the same waters, running through narrower straits while not following the slower speeds recommended by DFO to reduce ship noise. It will be more dangerous and louder for the southern resident killer whales. Meanwhile, more rail along the rivers puts salmon habitat at risk. Without salmon there will be no southern resident killer whales.
5) Will it increase the amount of oil moved by rail: Absolutely
As reported by Global News: the Paris-based IEA forecasts in its latest oil markets report that Canadian crude-by-rail exports will grow from 150,000 b/d a day in late 2017 to 250,000 b/d this year and then to 390,000 b/d in 2019. In June we crossed 200,000 b/d and current predictions are that we will see 300,000 b/d by December.
On the American side of the border just three (Tacoma, Anacortes, or Ferndale) of the region’s six refineries moved over 156,800 barrels of oil per day by rail in 2017 and every indicator is that the volume will be increasing absent TMX. These trains are carrying explosive Bakken crude through some of the most densely populated parts of the Pacific Northwest and along the sides of some of our most important salmon rivers.
6) Will it increase the likelihood of a rail spill: Absolutely
We all know that risk of incident is 4.5 times higher for transportation via rail over pipeline and more of the rail route is along the river sides than is the pipeline. Many activists complain about the sourcing of the 4.5 times stat so let’s go to Citylab and the Sightline Institute, both of which warn about the increase in risk of oil spills associated with this increase in oil volumes. There will be more oil-by-rail spills and because our rail lines run along river sides we will have far more risk to salmon habitat.
7) Will it increase the cost to transport Alberta oil: Yes
Oil-by-rail increases the cost to transport oil, which means to sell the oil to their customers producers will have to discount the price of that oil. This decreases the royalties earned by the Alberta government and the money available for transfer payments to fund our social services.
8) Will it decrease oil sands developments: Yes, likely
This is the reason the activists have been fighting the TMX. By increasing the cost and decreasing the price the result is a slow-down of future development. Just ask Suncor. The problem with this is that it will not have any effect on global oil use (see next question).
9) Will that decrease in oil sands development results in a decrease in global GHG emissions: Absolutely not
We live in an integrated world economy with a glut of oil supply. Any decrease in Canadian production will be offset by an increase in supply from any of the 30+ nations that produce crude oil. As a fungible commodity our loss is someone else’s gain and absent some change in demand the result will be a trade-off with no change in global emissions but more money for foreign dictators. This is the part of the story the activists never want to admit.
10) Will it make it harder to fight climate change in Canada: Absolutely
Alberta made the completion of the pipeline a condition for their joining the national climate action plan. Alberta’s Climate Leadership Plan, which included an aggressive move off of coal for electricity, is also in doubt. So besides not affecting global emissions and reducing the money Alberta generates from its natural resources the loss of the pipeline will set back our national plan to cut our carbon emissions and will likely drive the Notley government out of power. Her more-climate friendly government will be replaced by a Jason Kenney government. Mr. Kenney has made it abundantly clear that he will fight the national climate plan using every tool at his disposal. Without Alberta and Saskatchewan as active partners Canada has no chance of meeting our Paris Agreement NDCs and we will likely lose the governments most committed to fighting climate change. Good work activists.
11) Will it decrease Canadian prosperity: Yes
The money generated by natural resources is pumped back into our economy and paid to our government as royalties and increased taxes. That is the money that pays for our social service net, medicare and other government services. The loss of revenue will hurt Canadian prosperity and reduce the money available to pay for the transition off fossil fuels.
12) Will British Columbians remain hostage to high oil prices with zero control over supplies: Yes
Coastal British Columbia faces a 30,000 b/d shorfall in refined fuels which explains why we pay the highest gasoline prices in the country. So now instead of paying 2-3 cents litre more in increased tolls (tolls that would help pay for improved spill response) we will be paying a scarcity premium to US suppliers. The same 12-15 cents/litre scarcity premium we have been paying for the last several years. We pay this premium because the current Trans Mountain is oversubscribed and we need to outbid Oregon and Californian buyers for the unallocated supply out of the Puget Sound. This will continue and instead of our gasoline purchases helping to pay for Canada’s social services net they will go to American refinery owners.
13) Will it reduce the risk to First Nations communities: Absolutely not
This is the part of the story that confuses me the most. Somehow the anti-pipeline activists have managed to convince some of the First Nations on the Fraser River that the pipeline is a greater risk to their communities than oil-by-rail. This means these First Nations have been fighting a project that has the potential to significantly decrease the risks to their communities and their food sources. These activists have literally convinced the First Nations to fight against their own best interests.
14) Will it reduce the prosperity of First Native communities: Absolutely
Every First Nation in BC relies on fossil fuels for transportation, to move foodstuffs, and to supply most of the necessities of life. Every First Nation in BC will paying more than they should for those fossil fuels if the TMX is not built. As well, the various mutual benefit agreements made between the project and the First Nations will not happen. These First Nations will be exposed to higher risks due to oil-by-rail and will lose money at the same time. That doesn’t even consider all the First Nations-owned companies slated to help build and maintain the pipeline that will not do that work. Hundreds of millions of dollars a year will be lost in communities with few other sources of income. It is simply amazing how activists using words like “sovereignty” and “pride” have convinced many First Nations to impoverish themselves.
15) So who wins and who loses if the TMX doesn’t go through?
Losers: Canadians, the environment, salmon, the Southern Resident Killer Whales, and Canada’s fight against climate change
Winners: Activist NGOs, American refinery owners, and foreign dictatorships
As an environmental scientist, when I hear activists claiming that they are fighting the pipeline to “protect the inlet” or to “protect our waters” I can say quite convincingly that these arguments simply don’t hold water. The underlying challenge on the Trans Mountain file has been that it represents a compromise to provide the safest of the various alternative means to transport the liquid fuels we need to the Pacific Northwest.
If the TMX is blocked the crude oil necessary for our continued existence on the West Coast will still need to flow. It will simply flow via less safe means, specifically:
- Explosive Bakken crude will flow in even greater quantities along rail lines that run the virtual length of the Columbia River and through the heavily populated communities of the Pacific Northwest.
- Canadian oil trains will run in greater numbers alongside the Thompson and the Fraser Rivers and through every community along that route. A spill in either river will risk salmon runs that serve as the food source for, and are held sacred by, dozens of First Nations communities in British Columbia.
- Instead of highly-regulated Canadian tankers bringing Canadian crude to California and Asia we will see the Puget Sound and Semiahmoo Bay full of tankers coming out of the Middle East and registered in whatever jurisdiction has the lowest safety standards.
- The eventual risk to the Salish Sea won’t be the one major accident every 2000+ years described in the TMX risk assessments, it will be orders of magnitude higher.
So what are we looking at if the activists manage to stop the TMX? Certainly not a decrease in ecological risk. Rather we will see an increase in risk to our rivers and the marine environment…and at what cost? Any rent-seeker who thinks that blocking the pipeline will somehow help us fight climate change is barking up the wrong tree, because the countries that will serve as the replacement for Canadian oil (the Saudis, Nigerians and Algerians) are not paying into our federation; they are siphoning money out of it. If you want your bridges, roads and sewage plants built/repaired, then you are going to need money and blocking the Trans Mountain is exactly the wrong way to obtain those funds. If you argue that fighting the TMX somehow is part of a fight against climate change that is simply bad thinking. The pipeline was part of the national plan to fight climate change and that plan looks like it has been scuttled by the activists.
While I agree the current process has not been a perfect one; it had, at least, been a transparent one. The allocation of risks associated with the status quo has not involved the balancing of risks and is anything but transparent. As I have written numerous times, we need to wean Canada off fossil fuels as our primary energy source. If we are to avoid the serious consequences of climate change, we will need to eliminate fossil fuels from our energy mix. However, contrary to what many say, the process of doing so will take decades, and in the meantime we will still need petroleum hydrocarbons. The TMX project is the best project on the books to achieve that goal.