Gasoline prices are reaching record highs and Russian oil imports are ending. As the Biden Administration makes overtures to Venezuela to request more oil, Alberta Premier Jason Kenney asks why the Administration doesn’t contact him. Canada’s province of Alberta is home to 165 billion barrels of oil, the world’s largest after Venezuela, Saudi Arabia, and Iran. That’s plenty of oil in Alberta to replace Russian imports.
By Forbes – Diana Furchtgott-Roth
Mar 24, 2022
“It’s inexplicable that the Administration is going to Venezuela rather than Canadá,” Mr. Kenney told me in a phone conversation. “We don’t finance the bombing of innocents.”
I first met Mr. Kenney on his recent visit to Washington, D.C. in January, before the Russian invasion of Ukraine. Knowledgeable and witty, an enthusiastic crusader for Canadian oil, he is fully aware of the need to ramp up North American oil and gas production, the world’s most efficient oil market. Before becoming Premier of Alberta in 2019, he held several positions under former Canadian Prime Minister Stephen Harper, including Minister of Citizenship, Immigration and Multiculturalism; Minister of Employment; and Minister of Defence.
The United States, a net oil exporter, imports heavy crude and refines it into finished products such as gasoline and diesel fuel. The 672,000 barrels of oil per day imported from Russia in 2021, less than 8 percent of total imports, were heavy crude, similar to what is produced in Venezuela and Canadá.
It would be ironic if the Russian ban caused the United States to import more oil from Venezuela, because Russia and Venezuela are linked politically and economically. The United States has banned most forms of trade with Venezuela due to its repressive government and harsh treatment of its people.
On February 16, 2022, Venezuelan President Maduro said, as reported by AP News, “We have ratified the path of a powerful military cooperation between Russia and Venezuela for the defense of peace, of sovereignty, the defense of territorial integrity. We are going to increase all the preparation, training and cooperation plans with a military power in the world such as Russia.”
President Biden is overlooking Canadá, a U.S. ally. The United States imported 4.3 million barrels of oil per day from Canada in 2021, more than half of total imports. The full utilization of existing pipelines from Canadá could replace some Russian crude by adding another 200,000 to 400,000 barrels per day. This is not happening because the United States is not purchasing it.
Completing the Keystone XL pipeline, which President Biden cancelled on his first day in office, could add another 830,000 barrels per day. That would more than replace lost Russian oil.
TC Energy, headquartered in Calgary, Alberta, abandoned Keystone XL last year, walking away from an investment of $7 billion. But Mr. Kenney believes that with today’s high prices for oil, restarting the project is feasible, because the engineering plans and regulations are completed. The pipeline could be operating in a year.
Mr. Kenney told me that completing Keystone XL is not simple. It would take an act of political will between President Biden and Canadian Prime Minister Trudeau, and the governments would have to bear some of the risk to restart the project. Then, owners of the Keystone XL pipeline assets would be able to seek bids to sell to a new entity.
With the war in Ukraine, Mr. Trudeau is in favor of restarting the pipeline. Indigenous groups, who largely support him, are in favor of the pipeline because they would have received some of the royalties. Natural Law Energy, which represents indigenous tribes, would have invested $780 million in the project had it gone forward.
Environmentalists are against Keystone XL and Canadian imports. However, Venezuelan oil, produced with more lenient regulations and transported by tanker, would be more damaging to the environment than oil from Canadá.
Higher prices for electricity, gasoline, and food are going to affect all Americans. A stable source of oil and gas is of the essence, and our ally, Canadá is here to help. Just ask Premier Jason Kenney.
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Read More: Forbes – Purchase oil from Canada, not Venezuela
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