Time for Quebec politicians to rethink pipeline?

There’s an elephant in the room of the politicians involved in the Paris Accord.

But first, here in Canada… In this report, I will go with the position that the pipeline is half full, as opposed to half empty – at least that’s how this is starting, with no guarantees of how many words it may take to change to my traditional cynicmatic (my word) verbal visage.

Change is a good word to start off with, and that’s what happened this week with the CN Rail workers’ strike that put the squeeze on propane supplies from outer Canada (Alberta) to inner Canada (Quebec and Ontario).

Maybe I missed something here, but wasn’t Quebec the same province that declared just post-election days ago that it would never allow (tolerate?) Alberta crude crossing its border?

Does this also mean crude oil and its derivatives?

Because that’s what propane is, a by-product of the refining process of any crude oil, including Alberta crude.

Now this propane can be moved by pipeline as a natural gas liquid, as it does now to Sarnia’s chemical valley where it is processed into propane and other gases. From Sarnia, it then goes by rail to Quebec, or, with this week’s interruption, by truck.

Both of these transportation options are high risk when compared to movement by pipeline. But Quebec is firm on its position on pipelines, and anything related to crude oil from anywhere except Saudi Arabia.

As Alberta propane is used as a drying agent for the farming industry and a standby fuel for hospitals and schools (and indeed the only heating source for those remote communities not directly serviced by natural gas), may I suggest it may be time for politicians in Quebec to rethink their position? That is if any thought was even given to it in the first place.

Speaking of thought, the self-appointed and self-titled, Ecofiscal Commission is warning all of us to be ready to pay an additional 40 cents a liter for gasoline by 2030 to meet our self-declared Paris targets. That won’t be the end but only the beginning, as our current federal leadership wants us to be carbon neutral, or more like neutered, by 2050. So, a 40-cent increase may look like pocket change, but it’s about all we’ll have in our metaphorical pockets.

It is difficult for me to imagine President Donald Trump, or any potential U.S. president, telling his or her electorate that they should be ready to pay an additional $1.50/gallon in a carbon tax to reduce greenhouse gas emissions.

This is because the U.S., the largest energy consumer in the world, signed off, not on, to the, “nudge, nudge, wink, wink,” Paris Accord. A key part of the agreement was the $100 billion per year, starting in 2020, needed for developing countries to reduce their GHG. Without the $45 billion contribution from the U.S., this program is doomed to fail.

The Paris Accord may be a good place to visit, but the U.S. doesn’t want to live, or even be there.

The elephant has left the room and slammed the door.

~ The Grouch

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Roger McKnight is the Chief Petroleum Analyst with En-Pro International Inc.
Roger has over 25 years experience in the oil industry, and has held senior marketing management positions responsible for national and international accounts. He is the originator of the card lock concept of marketing on-road diesel that is now the predominant purchase method of diesel in Canada. Roger's knowledge of the oil industry in North America, and pricing structures has resulted in his expertise being sought as a commentator by local, national, and international media. Roger is a regular guest on radio and television programs, and he is quoted regularly in newspapers and magazines across Canada.

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  • Good morning Roger,
    Thank you for raising this crucial question.

    Our market study by the Conference Board of Canada indicates that the extraction as a gas plant natural gas liquid (NGL) represents over 90 per cent of the total and production as a refinery liquefied petroleum gas (LPG) represents under 10 per cent of Canada’s total propane production levels, estimated at close to 220 kb/d (thousands of barrels per day) for 2016. https://propane.ca/wp-content/uploads/2018/12/CPA_Propane_Market_Study_OVERVIEW_CBoC_EN_2018.pdf

    Nathalie St-Pierre