Energy Minister Tim Hodgson has thrown cold water on Trans Mountain’s ask to prioritize optimizing the capacity of the government-owned oil pipeline before greenlighting new major pipeline projects.
Prime Minister Mark Carney has promised to turn Canada into a world-leading energy superpower and his party passed the Building Canada Act in June, which gives the government sweeping new powers to approve major projects of national interest.
“The optimization… I don’t think that’s a project of national interest,” Hodgson said Wednesday. “If there’s a case to be made for optimization, they will make that case … and we’ll consider it through the normal course.”
The Trans Mountain pipeline ships oil from Alberta to the B.C. coast. In 2018, the federal government purchased the pipeline and funded a major expansion that has nearly tripled the pipeline’s capacity.
The expanded pipeline, which started shipping oil in May 2024, can now handle up to 890,000 barrels per day - but that capacity could be increased to nearly 1.2 million barrels per day through optimization, according to Trans Mountain CEO Mark Maki.
“My personal belief is that you look at the optimization of your existing pipelines, it’s the first thing you do, because it’s the easiest thing to do,” Maki said in an interview with CTV News Chief Political Correspondent Vassy Kapelos in Burnaby, B.C., on Tuesday.
“It’s much harder to build another TMX somewhere,” he added. “And for that reason, optimize the kit that you have, which you can do in steps over time, and then add capacity as it’s needed, and then you have time to evaluate the bigger issue, which is, do you need another pipeline somewhere?”
While optimization could further increase the potential capacity of Trans Mountain, the pipeline is currently operating at 85 per cent of its current maximum capacity.
B.C. Premier David Eby has seized on this operating gap and says Canada should prioritize maximizing the use of the Trans Mountain pipeline before pursuing a new oil pipeline project through his province.
Conservative Leader Pierre Poilievre said Wednesday that Canada should “absolutely” prioritize optimizing Trans Mountain, but that it “still won’t be enough.”
“We have the capacity to pipe two or three million additional barrels of oil to overseas markets. So let’s do all of it,” said Poilievre, before suggesting the Trans Mountain CEO is “trying to shut out competition.”
Alberta Premier Danielle Smith has been advocating for a bitumen pipeline from her province to B.C.’s northern tidewaters.
When asked about Maki’s comments for Canada to optimize TMX first before building a new pipeline, Alberta’s Energy and Minerals Minister Brian Jean said the province supports “completely filling and optimizing TMX and building a new, million-barrel-per-day, bitumen pipeline to the northwest coast of British Columbia.”
“Even with both of those, we won’t meet Asia’s projected demand for Alberta’s heavy oil. As a government, we fully support every effort to increase TMX’s egress capacity to avoid egress bottlenecks as we take the time to approve and build new pipelines,” Jean said in a statement to CTV News.
Maki said there are “very doable, very cost-effective” ways to increase the government-owned Trans Mountain pipeline’s capacity. Namely, he said, adding more horsepower to the existing infrastructure could boost oil shipments from about 890,000 barrels a day to nearly 1.2 million barrels a day.
“That involves pumps, motors in existing locations, maybe some new locations, and then power infrastructure to supply that, and maybe a little bit of pipe, TBD,” he said. “So, we’re working through that now.”
According to an analysis by Alberta Central chief economist Charles St-Arnaud, Trans Mountain has contributed to narrowing the discount at which Alberta oil is sold, leading to an extra $2 billion in revenue for the federal government.
With files from Spencer Van Dyk and Stephanie Ha
