Sask. legislation to potentially block BC oil exports expected Monday

Saskatchewan Energy and Resource Minister Bronwyn Eyre is expected to introduce The Energy Export Act Monday afternoon. This is legislation Premier Scott Moe said would be introduced to ensure Saskatchewan oil does not go to British Columbia, if Alberta stops their exports.

This is the latest chapter in the ongoing feud primarily between B.C. Premier John Horgan and Alberta Premier Rachel Notley over delays to the federally approved Trans Mountain pipeline expansion.

READ MORE: Saskatchewan premier says legislation is coming to block energy exports to B.C.

B.C. is seeking a legal ruling into whether the province can restrict increased amounts of oil entering Canada’s most western province. There is strong opposition to the pipeline in parts of B.C., due to concern over the economic and environmental impact of an oil spill in the Pacific Ocean.

The concern among opponents is the increased amount of oil that would be carried by Kinder Morgan’s $7.4 billion pipeline expansion. If completed, the Trans Mountain pipeline would triple its capacity.

READ MORE: B.C. still not ready with reference question for courts on Trans Mountain pipeline

Last week, Moe said legislation would be coming in “days, not weeks” to potentially block exports of Saskatchewan energy products to B.C., and that Saskatchewan would only take action if Alberta did first.

Moe said he stands by Notley’s support of the pipeline — and if Alberta turns off the taps, Saskatchewan won’t be there to backfill B.C.’s energy demands.

In 2014, trade of refined petroleum products such as gasoline was the fourth biggest market between Saskatchewan and B.C. Saskatchewan shipped out more than $350 million worth of product to the coastal province.

Saskatchewan estimates that in 2018, these exports are worth closer to $400 million.

Based on estimates from the University of Calgary School of Public Policy, the lack of coastal access due to limitations of existing infrastructure costs Saskatchewan $150 million in resource royalties annually — which translates to an estimated loss of $1.8 billion in revenue potential for oil producers according to the province.

READ MORE: Mixed results in poll over Trans Mountain pipeline debate

However, due to market limitations reducing the coast of Canadian crude Saskatchewan estimates, this revenue loss is even greater.

On April 23, the price-per-barrel for American oil was $68.36 based on WTI Crude. The Canadian Crude Index was $49.28.

With this price difference, Saskatchewan says lost resource revenue is $210 million, and the Saskatchewan oil industry cost is $2.6 billion in uncaptured value annually.