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U.S. ambassador 'encouraged' by Carney's energy pact with Alberta, expects more oil shipments to U.S.
OTTAWA — The U.S. ambassador to Canada says he is “encouraged” by the energy deal Prime Minister Mark Carney struck with Alberta Premier Danielle Smith, saying he believes it will lead to more oil and gas production — increasing expectations that more product will flow south of the border.
Pete Hoekstra’s comment come as Carney weathers some domestic political fallout since the signing of that agreement, with critics of it, such as B.C. Premier David Eby, saying no proponent has even stepped forward to propose building a new pipeline.
When it comes to the Canada-U.S. relationship, however, oil had formed part of the negotiations between Carney and Trump in exchange for reprieve from tariffs, before the U.S. president called off the talks in late October. It was also set to cover uranium.
Earlier that month, the prime minister had raised the idea of reviving the Keystone XL pipeline during his last White House meeting with the president, with his government linking it to seeing progress on tariffs.
Hoekstra says any agreement the U.S. strikes with Canada will include oil.
“What the expectations are on oil is that there would be more oil capacity, production and export opportunities down to the United States,” Hoekstra told National Post in a wide-ranging interview on Monday.
“That’s what we’re looking for.”
While Carney has promised to transform Canada into an “energy superpower,” Trump returned to the Oval Office for a second time with a promise to “drill, baby, drill.”
The ambassador said both countries share an interest in further developing their oil sectors, with most of Canada’s oil from Alberta, its largest oil-producing province, being shipped and processed in U.S. refineries.
Hoekstra said the U.S. feels “very encouraged” by Carney’s recent deal with Smith. That deal commits Carney to help pave the way for a new oil pipeline by expressing a willingness to revisit the federal moratorium on oil tanker traffic off B.C.’s coast, in exchange for Alberta promising to strengthen its industrial carbon tax.
“It seems to put in place a framework for significantly more oil production and natural gas in Alberta,” the ambassador said.
“We expect that as that moves forward, that some of that oil, most likely will be shipped to the United States.”
While an exact route has yet to be established, the agreement between Smith and Carney explicitly states that they would work together on building “one or more private sector constructed and financed pipelines,” with the focus being on one that would deliver Alberta bitumen specifically to Asian markets.
Diversifying Canada’s market access has been one of Smith’s main pitches for why the federal government should get on board with seeing a new pipeline built in the midst of a trade war with the U.S., warning earlier this fall that her other option would be to send more oil south of the border at a time when Canada is looking to expand its trading relationships.
Smith has also spoken favourably in recent months about the Carney government using energy like oil as a tool for leverage with the Trump administration.
When it comes to the Carney-Smith pipeline pact, Hoekstra said he understands, “the possibility that some of that oil will find its way to Asia,” adding that the U.S. takes no issue with Canada searching for other markets.
He said the deal with Alberta shows a “synergy” between Canada and the U.S. when it comes to energy, including when it comes to questions about energy affordability.
“Number one, we think it will result in the production of more oil and natural gas.”
Since signing the deal with Alberta, Carney has been dealing with a range of domestic fallout, from First Nations chiefs in B.C. speaking out about not having been invited to the talks, to Liberal MPs from B.C. voicing internal concerns and publicly declaring that no new pipeline can happen without the consent of both the province and impacted Indigenous people.
The prime minister also lost a cabinet minister over the agreement.
Steven Guilbeault resigned from cabinet after the deal was made public, saying that the work he had done to advance national climate policies under former prime minister Justin Trudeau was being undone, including a federal set of clean energy regulations, which Carney committed to exempting Alberta from under the deal.
National Post
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