May 17 (Reuters) - Canada could add over a million barrels
per day (bpd) of oil export capacity to the United States over
the next two years, Alberta Premier Jason Kenney told a U.S.
Senate committee on Tuesday, while also calling for a new
cross-border oil pipeline.
However, federal Natural Resources Minister Jonathan
Wilkinson said there was little discussion in Ottawa or
Washington about a new oil pipeline, and warned that narrowly
focusing on fossil fuel security risked hindering climate goals.
Kenney and Wilkinson were in Washington addressing a Senate
energy and natural resources committee on the issue of energy
security, as countries around the world face rising crude prices
and tight supply following Russia's invasion of Ukraine.
Their contrasting remarks illustrate how the federal Liberal
government is often at odds with conservative politicians like
Kenney over how best to manage Canada's vast oil and gas wealth
while also reducing climate-warming carbon emissions.
"With political will from Washington we could also get
another major pipeline built that would forever allow the United
States to free itself from imports from hostile regimes," Kenney
told the committee, adding Alberta is the largest source of U.S.
energy imports.
The Canadian government has previously said Canada could
increase oil pipeline exports by 300,000 bpd this year.
Kenney said an extra 200,000 bpd could be shipped south by
rail, while technical improvements from midstream companies
could add as much as 400,000 bpd of pipeline capacity by next
year. The Canadian government-owned Trans Mountain pipeline
expansion project is expected to be finished late next year, and
will add another 600,000 bpd, he said.
Wilkinson told Reuters after the Senate hearing that this
was the first he had heard of a potential increase in rail
capacity or technical improvements, and any increase in oil
exports to help offset lost Russian supply would need to be
consistent with Canada's climate goals.
"The discussions I was having with White House were more
forward-looking, about hydrogen, about critical minerals, about
clean technologies," he said.
Canada exports around 3.8 million bpd of oil to the United
States and until recently faced pipeline constraints that left
crude bottlenecked in Alberta. U.S. President Joe Biden revoked
a key permit for the Keystone XL pipeline in early 2021,
infuriating the Canadian energy industry.
However with the start-up of Enbridge's Line 3 replacement
project last year, Canadian export capacity is now broadly in
line with production.
Energy analyst Rory Johnston, founder of the Commodity
Context newsletter, said oil production is expected to only grow
about 100,000 bpd a year going forward, meaning more export
capacity would not necessarily mean more barrels crossing the
border.
(Reporting by Nia Williams
Editing by Bernadette Baum, Marguerita Choy and Nick Zieminski)