Alicia Planincic: If Canada wants to be an energy superpower, it needs to stop banning energy exports

Canada wants to be an energy superpower.

But a major obstacle is the Oil Tanker Moratorium Act, which came into effect in 2019. Meant to reduce the risk and damage of oil spills in ecologically sensitive areas, the act prohibits tankers carrying more than 12,500 tonnes of crude oil from stopping, loading, or unloading along the northern coast of British Columbia—from the tip of Vancouver Island up to Alaska.

That 12,500 tonnes might seem like a lot at first glance, but it’s really not.

For instance, the Port of Prince Rupert, located within this area, can accommodate some of the world’s largest ships—those carrying up to 250,000 tonnes of cargo. It also has the deepest natural port in North America, and is ice-free year-round—good qualities for a major port. But under the moratorium, oil tankers are limited to just 4 or 5 percent of what these ports can physically accommodate. Likewise, the Port of Kitimat, also in the moratorium area, can handle ships of up to 320,000 tonnes.

The result? It’s simply not viable to export large amounts of crude oil from ports in the moratorium area. For example, the Eagle Spirit Pipeline—a First Nations-owned project which would have brought oil from Fort McMurray in Northern Alberta to Prince Rupert—was cancelled once the moratorium was introduced because it made crude oil exports uneconomical.

The only large port on Canada’s West Coast not subject to the moratorium is Vancouver. But it’s already heavily congested and, due to physical constraints, can only accommodate mid-sized tankers.

Meanwhile, major ports on the East Coast—where 85 percent of all tanker movement occurs—face no such restrictions. Canada’s competitors don’t face these types of restrictions either. That includes other oil-producing countries with rich biodiversity and difficult-to-navigate coastlines, like Norway.

Environmental concerns shouldn’t be ignored, but the policy needs to match today’s reality. Global oil spills from tankers are down 95 percent since the 1970s, even as global shipping volumes have risen by over 50 percent. And that progress isn’t the result of blanket limits and bans but rather improvements in regulations and safety standards, such as double hull mandates.

Being an energy superpower will require competitive policies that enable more Canadian oil to reach more markets. By restricting access to some of Canada’s best-suited ports, the tanker ban undercuts Canada’s ability to get oil to international markets, increase investment, and diversify trade away from the U.S. market. That means fewer good jobs for Canadians and a lower standard of living.

A version of this post was originally published by the Business Council of Alberta at businesscouncilab.com.