Diversifying markets for Canadian oil production is vital to ensure Canada receives full value for its natural resources.Canadian oil supply is growing, just at a slower pace than previously forecast. This reality, combined with the fact that the International Energy Agency reports more than a quarter of the total world energy demand will still be met by oil in 2040, means Canada needs more pipelines in all directions to supply growing global needs as well as domestic markets. Less than one per cent of Canada’s oil is shipped to markets outside North America. So the case for additional pipelines remains urgent to move Canadian oil to Canadians and to the world.
Learn more about how crude oil is transported.
Western Canadian oil supply is growing by 1.5M b/d
Source: CAPP, 2017
Canada's resources. Canada's benefits
Without better access to tidewater and domestic markets, Canada receives fewer economic benefits from development of its oil and natural gas. The Canadian Energy Research Institute estimates the Western Canadian oil industry could contribute an estimated $230 billion in provincial and federal taxes, and provincial royalties over the next 10 years. It’s this economic contribution governments use to help pay for things that Canadians value and want such as health care, education and public infrastructure, including schools, roads and hospitals.
Canada's resources. Canada's benefits.
Canadian energy for Canadians
Despite having and making more than enough oil to meet all of Canada’s own needs, we spend about $19 billion a year importing oil from places such as the United States, Saudi Arabia, Algeria, Norway and Nigeria. Many of these countries have less stringent environmental standards than Canada’s, and that’s not ideal from a global environmental perspective.
With new pipelines to transport Western Canadian oil to Ontario, Quebec and the Maritimes, who currently rely on imports to meet their needs, we would have the opportunity to reduce Canada’s dependence on foreign oil while keeping the money spent on imports in Canada, where it can help create jobs and grow the economy.
Canadian Oil Imports
Source: Statistics Canada
Canada and the U.S.
The United States and Canada share the world’s largest and most comprehensive trading relationship. Energy is a major part of this relationship as Canada is the single largest foreign supplier of energy to the United States. Canada is uniquely positioned to contribute to meeting growth in U.S. energy demand.
Canada is the largest supplier of crude oil and petroleum products to the U.S., with the oil sands being the largest source. Growing domestic supply helped Canada overtake the Organization of Petroleum Exporting Countries (OPEC) for cumulative U.S. imports by the end of 2014.
Oil sands reserves have helped diversify global supply, reduced reliance on more distant sources of oil and improved North American energy security – while supporting economic growth in Canada and the U.S. U.S. crude oil exports to Canada were almost seven times higher in 2016 than five years ago. Meanwhile, Canadian oil exports to the U.S. have increased by about 40 per cent over the same time frame. Even with increased domestic oil supply, the U.S. will need to import oil.
Source: CAPP, 2016
Canada’s oil and natural gas industry provide economic benefits across North America. Almost 1,580 U.S based companies provided goods and services to Canada's oil sands sector. These included construction, electrical, engineering and equipment services (Source: CAPP, 2016). Canadian oil will find new paths to U.S. markets and continue to create jobs and wealth for Canadians and Americans.
While the U.S. will continue to be an important market for Canadian energy products, growing U.S. oil production means they are now also our greatest competitor. The U.S. recently ended an oil export ban and began selling its products overseas. And because of limited pipeline capacity, Canada sells 99 per cent of its oil into a saturated North American market at lower prices. This means Canada isn’t getting full value for its resources. A report by Scotiabank estimates that Canada will forego $10.8 billion in revenues in 2018 due to pipeline delays.