Will Kinder Morgan's Pipeline Really Open Asian Markets To Canadian Oil?

This week, Canadian Prime Minister Justin Trudeau said he would use public funds to help out the huge pipeline being built between the Alberta tar sands and the port of Vancouver, in British Columbia. This comes to add up to a row between the two Western provinces (which are pitted against each other) and the Texan company Kinder Morgan, in charge of the project, which has threatened with quitting altogether if there's no quick solution to the standstill.

I had heard about the pipeline, and some of the protests it has faced, but I didn't know much more than headlines about it. So today, as I wrote my weekly climate news wrap-up for Spanish magazine La Marea, I decided to delve a bit deeper into the discourse.

The main argument to build the pipeline is that access to the sea would allow tar sands hydrocarbons to reach the Asian markets. Without this, the return would not be too exciting. But, according to DeSmog Canada, producers already have this capacity, without using it.

In 2017, the Port of Vancouver only shipped 600 barrels of oil to China. That’s less than a tanker load. That same year, the port shipped almost 13 million barrels of oil, or about 24 Aframax tanker loads, to the U.S.

The article goes over a few reasons of this alleged low Asian demand:

• Canadian tar sands oil (like Venezuelan oil) is very heavy. This makes it very difficult to refine. China has better access to cheaper light crude from the Gulf countries and Iran.
• The tankers that fit the Vancouver port are not big enough to compete.
• There's enough pipeline capacity already.
• Spill risks decrease profitability.
• Crude will end up in California, not Asia, which has appropriate refineries and demand, at a lower return.

This is another example of mega infrastructures being built without much certainty of their future use. It's not a beginner's reading and requires a bit of previous knowledge, but it contains a lot of information you need to understand at least one side of the debate.