Clark, Redford move closer to pipeline agreement

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B.C. Premier Christy Clark says her province is moving closer to an agreement with Alberta that would lay a path for oil sands bitumen to reach B.C. ports.

A series of high-level meetings are under way to discuss how the two provinces can open up the path to B.C.'s coasts, and then Asian markets. An agreement is not imminent, but officials for both the provinces are working on a framework to address B.C.'s five conditions.

"I get more confident about that as the weeks pass," Ms. Clark said in an interview. "We are engaged at the highest level of the bureaucracy, the deputies are meeting about the five conditions and talking about how we can meet them together."

The Premier's comments mark a significant change in tone from just a year ago, when Ms. Clark and Alberta Premier Alison Redford emerged from a Calgary meeting and told reporters their discussions were "frosty."

Talks between Alberta and B.C. were stuck in political stalemate after Ms. Clark demanded a "fair share" of the financial benefits stemming from any oil sands pipeline crossing her province, along with other environmental and First Nations conditions being met.

At the time, Ms. Redford rejected the B.C. demands, suggesting that it was a grab for Alberta's royalty revenues. But Ms. Clark later clarified that her idea for a "fair share" of the benefits was not intended as a royalty grab, that there were other avenues to meet her conditions.

Fast-forward to the B.C. election last May – where Ms. Clark's Liberals won a surprise victory against their NDP challengers – and a friendly summit in Kelowna this June, and the two premiers seem to be working hard to show the relationship has begun anew.

"There is a real appetite in Alberta, and I'm really pleased about the direction that this is going. Now we see the federal government really stepping up and wanting to meet their pieces of the five conditions."

The Premier said progress in the talks is confirmation that the B.C. conditions are "tough, but fair and clear."

For Alberta's part, the province's Energy Minister Ken Hughes was equally optimistic, if short on details about the nature of the talks. With B.C. looking to make the most of its natural gas reserves by encouraging exports to Asia – and Alberta hoping to do the same for both its oil sands bitumen and natural gas – Mr. Hughes said Alberta and B.C. have a lot in common. He said the "mutual understanding" of each other's ambitions and opportunities is growing, and it doesn't hurt that B.C. Natural Gas Development Minister Rich Coleman once lived in Alberta and "actually understands us, which is helpful."

But he said there's a lot of work to do. "There are many aspects to the relationship between Alberta and British Columbia," Mr. Hughes said. "What you will see if there are results out of this is progress on specific projects that we can all support."

Ms. Clark and Prime Minister Stephen Harper met in B.C. two weeks ago where they discussed the future of oil pipelines, a prelude to a high-profile federal effort to build support within B.C. for both Enbridge's Northern Gateway pipeline proposal, and the plan to twin the existing Kinder Morgan line. That federal push also includes sending deputy ministers from Ottawa to meet with native leaders in an effort to forge a new relationship.

However, federal Natural Resources Minister Joe Oliver told reporters in Calgary earlier this month it was up to Alberta and B.C. to sort out whether B.C. gets its special conditions met. Ms. Clark insists her conditions are not intended to try to prevent economic development. "We're seeing the rewards of sticking to our guns on that because the rest of the country, increasingly, is coming to accept that these conditions can be met."

Environmental economist Andrew Leach – who holds the Alberta School of Business Enbridge professorship in energy policy – said B.C. has a right to make sure environmental and spill risks brought on by an crude pipeline are fully addressed, and covered. However, he said putting restrictions on which products from other provinces can be shipped through B.C. is "dangerous territory" for the free movement of goods in Canada. "It just becomes a huge economic cost to everyone," he said.