CALGARY — The Trump administration’s trade offensive against Canada has revived support for the construction of pipelines to the east and west coasts—a sharp pivot on fossil fuel projects once considered unbuildable due mounting legal hurdles and environmental opposition.
Earlier this week, Alberta Premier Danielle Smith told reporters there’s been a “sea change” in attitude, as provincial leaders look to diversify Canada’s energy market in the face of U.S. President Donald Trump’s trade threats.
Talking Points
- Alberta Premier Danielle Smith said there’s been a “sea change” in support for new pipelines as provinces look to diversify Canada’s energy markets
- Actually building new east-west pipelines, however, will require a multi-pronged effort on the part of Ottawa to support development, potentially at high cost to taxpayers
Quebec ministers current and former have said the province might now support liquified natural gas (LNG) projects, backing off their previous rock-ribbed opposition to such developments. British Columbia, whose former premier vowed to use “every tool in the tool box” to block the $34-billion Trans Mountain expansion pipeline, said it will expedite regulatory permits for two regional natural gas pipelines and one LNG project in the province. Voices outside energy circles have weighed in, too: in a recent X post, Shopify CEO Tobi Lütke called coast-to-coast pipelines a “no brainer.”
Yet, it’s far from certain that the new-found public support will translate into a will to build. Companies proposing major projects face the same towering regulatory and legal challenges that have scuppered previous attempts, from the Northern Gateway pipeline across B.C. to the Energy East project that would have connected Alberta’s oilsands to Atlantic Canada.
Pipeline companies, energy experts and First Nations leaders interviewed by The Logic say overcoming those impediments will require muscular intervention on the part of Ottawa and provincial governments. That could mean the federal or provincial governments taking direct stakes in pipeline proposals; designating “strategic” projects through legislation; and backing loan guarantees to First Nations to let those communities take direct equity stakes in projects. It could also mean substantively rewriting the Liberal government’s project review regulations, introduced under Bill C-69 in 2018.
“Whether it’s financial, whether it’s [loan] guarantees, whether it’s guarantees on regulatory timing, we need all hands on deck,” said Martha Hall Findlay, director of the University of Calgary’s School of Public Policy.
Last month, Enbridge CEO Greg Ebel said the company would need to see “real legislative change” before it would contemplate building a new megaproject. He suggested Ottawa could identify certain infrastructure projects as “in the national interest” and therefore eligible for fast-track approval.
In an email, Enbridge spokesperson Gina Sutherland expanded on Ebel’s caveats: “For Enbridge to consider investing in new pipeline projects, we would need to see certain developments,” she said, including better federal and provincial regulatory co-ordination, general support for fossil fuel production and Ottawa “eliminating C-69.” The company also supports a “more substantial federal loan guarantee program” to backstop Indigenous investments, Sutherland added.
Enbridge had for years sought to build the Northern Gateway pipeline that would have linked northern Alberta’s oilsands to the B.C. coast, but the project met years of delays and regulatory challenges, and Prime Minister Justin Trudeau ultimately rejected the project in 2016.
TC Energy, another major Calgary pipeline company, had proposed the Keystone XL and Energy East projects, which met similar fates and prolonged delays. Spokesperson Jaimie Harding said the firm would need “continental energy collaboration” before building new projects, but didn’t elaborate.
So drawn out were all of these application processes, that the people behind the projects have developed a kind of “PTSD,” Findlay said.
Findlay, who was previously the head of the Canada West Foundation, had long tried to convince the federal government that their reworking of its project assessment regime would make it nearly impossible to build new pipelines. Among her concerns, she said, the updated federal review process is “loaded with political discretion” and grants the environment minister the power to effectively shut down projects.
“Ten years from now, which is how long it would likely take, you’ll run into the same opposition.”
“We worked so hard for so long on trying to communicate how challenging some of the stuff was going to be, and it fell on deaf ears.”
Today, as Trump’s trade threats expose Canada’s failure to reach new energy markets, former finance minister Chrystia Freeland and other ministers have suggested streamlining the very legislation they created—a reversal that industry observers are greeting with varying degrees of disbelief.
“I’m trying to be really positive about all of this, but there’s a massive lack of trust,” Findlay said.
Ultimately, building pipelines will demand the sort of heavy-handed approach it took to complete the Trans Mountain expansion, said James Coleman, a professor at the University of Minnesota who specializes in North American energy infrastructure. Which is to say, government will have to take a direct financial stake in a proposed project to ensure it gets built.
“They don’t get done unless they have a federal partner,” Coleman said.
The approach could prove unpopular because it exposes taxpayers to major costs. The Crown-operated Trans Mountain expansion project went nearly $30 billion over budget after years of delays. And government support for fossil fuel projects won’t deter—and may even amplify—environmental criticism.
“Ten years from now, which is how long it would likely take, or even three or five years from now, when you’re trying to get one of these pipelines built, you’ll run into the same opposition,” said Coleman.
Much of that opposition has come from Indigenous groups, which may explain why many industry representatives believe support from First Nations communities is the key to getting big-ticket infrastructure developments completed.
In its 2024 budget, the federal government introduced a $5-billion loan guarantee program for Indigenous peoples, which are intended to help them take equity positions in projects to directly reap the financial rewards.
A spokesperson for Conservative Leader Pierre Poilievre said a Conservative government would replace the review process introduced through Bill C-69 within its first 60 days in office, while letting companies divert part of their federal corporate taxes toward First Nations communities as a way to secure Indigenous support. Sam Lilly, Poilievre’s press secretary, did not respond directly to questions about whether a Conservative government would take stakes in projects or designate projects in the national interest.
Grand Chief Stewart Phillip, president of the Union of British Columbia Indian Chiefs, a consultancy group that represents around 130 of B.C.’s roughly 200 Indigenous communities, is unconvinced that governments or companies can win First Nations support any time soon for pipelines crossing unceded territories.
“The answer is still ‘no’,” Phillip said.
New projects face a “steep hill to climb” before they can get built, he said, while Donald Trump’s annexation threats and B.C.’s promise to fast-track $20 billion worth of energy projects has put some Indigenous people on edge.
In January, Phillip expressed support for major pipeline projects like Northern Gateway, but retracted his comments shortly after. “I think it was a wishful moment, wishing things weren’t so harshly polarized,” he explained when asked about the remark.
Simogyat Gwiiyeehl, a hereditary chief representing the Gitxsan Huwilp, said the community has thus far supported construction of a pipeline that would carry natural gas through its traditional lands, despite some environmental pushback.
The Prince Rupert Gas Transmission project, if completed, would feed into the Ksi Lisims LNG facility on B.C.’s north coast, an Indigenous-backed project that has already inked a supply agreement with Shell.