The most effective advertisement for Alberta oil this month was delivered in Edmonton, in public, by the United States ambassador.
Speaking at the Pacific NorthWest Economic Region summit on July 20, Pete Hoekstra put the American position in six words. “We want oil. We need oil.” He sized the need at 3 to 4 million additional barrels per day over the next decade, and described Canada as one of the best places on earth to get it, with Alberta and Saskatchewan making the most compelling case to supply it.
Sit with the role reversal. After a decade of Albertans being lectured about the end of oil demand, the customer walked into the producer’s living room and asked for more.
The Gap Behind the Ask
The mechanics of that 3 to 4 million barrel figure are straightforward refinery math. American plants, particularly in the midwest and on the Gulf Coast, are configured for heavier crude of exactly the kind this basin produces, and the traditional heavy suppliers have spent years in decline. The gap does not care about anyone’s politics. It has to be filled from somewhere, and the somewhere with the reserves, the rule of law and the existing pipe is sitting one border north.
The ambassador also confirmed what had only been reported before, that the Prime Minister made a preliminary offer to send more oil south and that officials in Washington were keen to take it, while needling Ottawa that visible eagerness is a poor look at a negotiating table.
Demand Was Never the Question
Hold this beside the other demand signal of the summer. Trans Mountain opened one lane to the Pacific and Chinese refineries promptly became the biggest seaborne buyer of Canadian crude. Now the American ambassador is quoting his country’s appetite in the millions of barrels. Both customers, both coasts, both asking.
Alberta’s problem has never been finding buyers. It has been getting permission to reach them. The West Coast Oil Pipeline application sits with the federal Major Projects Office while the demand it would serve introduces itself at podiums in Edmonton.
Negotiate Like a Supplier
A caution belongs here, because the same ambassador reminded the room that America has other options. True enough. Suppliers who take customers for granted stop being suppliers. The correct posture is neither swagger nor gratitude. It is capacity. Build the routes, serve both oceans, and let the customers compete for the barrel instead of the barrel begging for customers.
For twenty years the national debate treated Alberta oil as a problem to be phased out. The people who actually buy it just described it as a necessity to be secured. Only one of those positions comes with a purchase order.
The customer says the demand is there for decades. Does Canada finally build like it believes them?
