Canadian Energy Centre
Critical energy project approved in positive sign for Ontario, Quebec and Michigan

Inside the Enbridge Straits Maritime Operations Center at Michigan’s Straits of Mackinac. Photo courtesy Enbridge
From the Canadian Energy Centre
By Will Gibson
Michigan regulators give green light to Enbridge Line 5 tunnel
A key artery in the network supplying Michigan, Ontario and Quebec with essential petroleum products has cleared a critical hurdle to continue operations.
In December, Michigan’s Public Service Commission approved a US$500 million project to replace about seven kilometres of the existing Line 5 pipeline underwater in the Straits of Mackinac with a new pipeline housed in a concrete tunnel far beneath the lakebed.
“The commission recognized the reality, which is the public needs the Line 5 tunnel and the products it transports,” says Jason Hayes, director of environmental policy at the Mackinac Centre for Public Policy.
“This is how it is supposed to work, although it took more than three years to get there.”
An energy lifeline
The existing Enbridge Line 5 pipeline has operated since 1953. It moves up to 87 million litres of crude oil and natural gas products for use daily between Superior, Wisconsin and Michigan, Ohio, Ontario and Quebec.
“The average person doesn’t always understand how crucial it is. We do in Sarnia,” says Scott Archer, business agent for UA 663, a local union that representing pipe fitters and welders who work in refineries and petrochemical facilities in Sarnia, Ontario.
“Line 5 is the lifeline for Ontario and also provides feedstock for refineries in Quebec. All of our refineries receive their feedstock from it. It’s what provides vehicle fuel for private and public transportation. Trucking and the railroads rely on it. Our agriculture industry uses it to dry crops.”
Artist’s rendering of the Line 5 tunnel project proposed by Enbridge to protect the pipeline under the Great Lakes. Photo courtesy Enbridge
The 1,600 members of UA 663 understand that continued operation of Line 5 doesn’t just affect them or their families, Archer says.
“It’s really the entire region,” he says.
“We have 70,000 people who live in this town and almost all of them depend on Line 5 to feed their families and keep a roof over their head.”
The project approval means just as much in Michigan and Ohio, where the Enbridge network supplies refineries in Detroit and Toledo, as well as propane throughout the region.
“Michigan uses more propane than any other state in the lower 48,” Hayes says.
“About 55 per cent of the propane that heats homes and cooks food in our state goes through Line 5 and comes from Sarnia. Half of the jet fuel used at the Detroit International Airport comes from Line 5 feedstock. It’s essential to keep our state going.”
Aerial images of Michigan’s Straits of Mackinac, the communities of St. Ignace and Mackinaw City, and the Mighty Mac bridge spanning the Straits. Photo courtesy Enbridge
Additional approvals required
The tunnel project will need the approval of the Army Corps of Engineers at the federal level before Enbridge can start construction. The Army Corps is completing its environmental impact assessment, expected for completion in 2026.
Michigan’s attorney general Dana Nessel also continues to pursue court action in an effort to shut Line 5 down.
“The commission’s decision is still a big win,” Hayes says.
“[It] acknowledges the reality for regular people in Michigan and Ontario, who need fossil fuels, and the products made from them, in their day-to-day lives right now. It makes no sense to oppose a project that seeks to make it safer to transport them.”
Alberta
Alberta’s massive oil and gas reserves keep growing – here’s why

From the Canadian Energy Centre
Q&A with Mike Verney, executive vice-president, McDaniel & Associates
New analysis commissioned by the Alberta Energy Regulator has increased the province’s natural gas reserves by 440 per cent, bumping Canada into the global top 10.
Alberta’s oil reserves – already fourth in the world – also increased by seven billion barrels.
The report was conducted by Calgary-based consultancy McDaniel & Associates. Executive vice-president Mike Verney explains what it means.
CEC: What are “reserves” and why do they matter?
Verney: Reserves are commercial quantities of oil and gas to be recovered in the future. They are key indicators of future production potential.
For companies, that’s a way of representing the future value of their operations. And for countries, it’s important to showcase the runway they have in terms of the future of their oil and gas.
Some countries that have exploited a lot of their resource in the past have low reserves remaining. Canada is in a position where we still have a lot of meat on the bone in terms of those remaining quantities.
CEC: How long has it been since Alberta’s oil and gas reserves were comprehensively assessed?
Verney: Our understanding is the last fully comprehensive review was over a decade ago.
CEC: Does improvement in technology and innovation increase reserves?
Verney: Technological advancements and innovation play a crucial role in increasing reserves. New technologies such as advanced drilling techniques (e.g., hydraulic fracturing, horizontal drilling), enhanced seismic imaging and improved extraction methods enable companies to discover and access previously inaccessible reserves.
As these reserves get developed, the evolution of technology helps companies develop them better and better every year.
CEC: Why have Alberta’s natural gas reserves increased?
Verney: Most importantly, hydraulic fracturing has unlocked material volume, and that’s one of the principal reasons why the new gas estimate is so much higher than what it was in the past.
The performance of the wells that are being drilled has also gotten better since the last comprehensive study.
The Montney competes with every American tight oil and gas play, so we’re recognizing the future potential of that with the gas reserves that are being assigned.
In addition, operators continue to expand the footprint of the Alberta Deep Basin.
CEC: Why have Alberta’s oil reserves increased?
Verney: We discovered over two billion barrels of oil reserves associated with multilateral wells, which is a new technology. In a multilateral well, you drill one vertical well to get to the zone and then once you hit the zone you drill multiple legs off of that one vertical spot. It has been a very positive game-changer.
Performance in the oil sands since the last comprehensive update has also gone better than expected. We’ve got 22 thermal oil sands projects that are operating, and in general, expectations in terms of recovery are higher than they were a decade ago.
Oil sands production has grown substantially in the past decade, up 70 per cent, from two million to 3.4 million barrels per day. The growth of several projects has increased confidence in the commercial viability of developing additional lands.
CEC: What are the implications of Alberta’s reserves in terms of the province’s position as a world energy supplier?
Verney: We’re seeing LNG take off in the United States, and we’re seeing lots of demand from data centers. Our estimate is that North America will need at least 30 billion cubic feet per day of more gas supply in the next few years, based on everything that’s been announced. That is a very material number, considering the United States’ total natural gas production is a little over 100 billion cubic feet per day.
In terms of oil, since the shale revolution in 2008 there’s been massive growth from North America, and the rest of the world hasn’t grown oil production. We’re now seeing that the tight plays in the U.S. aren’t infinite and are showing signs of plateauing.
Specifically, when we look at the United States’ largest oil play, the Permian, it has essentially been flat at 5.5 million barrels per day since December 2023. Flat production from the Permian is contrary to the previous decade, where we saw tight oil production grow by half a million barrels per day per year.
Oil demand has gone up by about a million barrels a day per year for the past several decades, and at this point we do expect that to continue, at the very least in the near term.
Given the growing demand for oil and the stagnation in supply growth since the shale revolution, it’s expected that Alberta’s oil sands reserves will become increasingly critical. As global oil demand continues to rise, and with limited growth in production from other sources, oil sands reserves will be relied upon more heavily.
Canadian Energy Centre
Experts urge caution with Canadian energy in response to Trump tariffs

From The Canadian Energy Centre
By Will Gibson
‘We want Americans to stand up for our supply’
A lawyer by training, Gary Mar is also a keen student of history. And he recommends Canadians look at what happened when past U.S. administrations imposed tariffs on imports before jumping to add costs to Canadian energy.
“President Richard Nixon imposed a 10 per cent tariff in 1971 and withdrew it after a few months because it caused so much pain for American consumers,” says Mar, CEO of the Canada West Foundation, who served as Alberta’s trade representative in Washington from 2007 to 2011.
“Canadians and their governments need to be patient. Any tariffs on energy will be passed on to consumers in the United States. We shouldn’t let the president off the hook for raising the price to American drivers by putting more duties on energy we export,” he says.
“We want Americans to stand up for our supply, not displace the anger with President Trump for raising prices with anger towards Canadians.”
A major U.S. supplier
The U.S. imports more than four million barrels of oil per day from Canada, or about one out of every five barrels the country consumes. Most Canadian imports are destined for refineries in the U.S. Midwest including Illinois, Indiana, Michigan and Ohio.
About 99 per cent of natural gas imports into the United States also come from Canada. Natural gas imports flow primarily to Idaho, North Dakota, Minnesota and Montana, according to the U.S. Energy Information Administration.
Trump tariffs
Nixon put tariffs in place in an attempt to weaken the U.S. dollar against foreign currencies and strengthen U.S. exports.
Mar, who served as cabinet minister in the Klein and Stelmach governments from 1993 to 2007, sees Trump’s tariffs as aimed to repatriate manufacturing and jobs to America.
“President Trump made this explicitly clear…if you want to sell manufactured goods in the United States, you need to move your factories here,” says Mar.
“But Canadian oil and natural gas are key inputs that help U.S. manufacturing. We ship the products or partially refined products that support manufacturing of finished products in the United States. Tariffs will raise those costs for U.S. manufacturers and ultimately American consumers.”
A divisive rerun of the National Energy Program?
Mar’s former cabinet colleague Ted Morton agrees Canada needs to exercise patience and caution in any response to U.S. tariffs.
Morton, who served as an Alberta cabinet minister from 2006 to 2012, strongly disagrees with the idea of placing countervailing tariffs on energy exports to the United States. Morton casts it as a divisive rerun of then Prime Minister Pierre Trudeau’s controversial National Energy Program in the early 1980s.
Energy export tariffs “would be an attempt to revive Liberal Party support from disillusioned voters in Ontario and Quebec,” he says.
“The biggest loser in Trump’s new tariff war will be Ontario due to the integration of the auto sector between the U.S. and Canada. It’s simple political arithmetic. Ottawa could collect $4 or $5 billion by taxing energy exports in western Canada and send that money to prop up struggling industries in Ontario and Quebec,” Morton says.
“Ontario and Quebec combined have a total of 199 MPs, more than enough to form a majority government. It’s the ‘screw the West and take the rest’ strategy. It’s how the Liberals won the 1980 federal election, and they could try it again.”
Legal and constitutional precedents
And while imposing export tariffs on Canadian energy could be politically popular in central Canada, Morton suggests the action would not withstand a legal challenge thanks to legal and constitutional precedents set by former Alberta Premier Peter Lougheed.
“Peter Lougheed left future Alberta premiers with some very effective legal weapons. His government successfully challenged the constitutionality of Trudeau’s export tax on natural gas. He then teamed up with the other western premiers to negotiate a new constitutional amendment that affirms provincial jurisdiction over the development and conservation of natural resources,” Morton says.
“Premier Danielle Smith should win any constitutional challenge if the federal government tries to impose an export tariff on oil or natural gas.”
Morton, like Mar, also counselled patience in responding to tariffs because “Trump’s tariffs on Canadian energy will punish American consumers more than Canadians.”
The national interest
David Yager, who has studied and analyzed energy policy for more than 40 years, agrees tariffs on energy have the potential to drive a wedge between Alberta and the rest of the country in the same way the National Energy Program did.
“The dynamic definition of national interest is what I struggle with. Going back several decades, it was in the national interest to get oil and gas across Canada so there was a drive to build pipelines east and west,” says Yager, a consultant who also serves as a special advisor to Premier Smith.
“Today, the national interest has flipped again, and energy exports are now a source of revenue to save the ‘real’ Canada, which is central Canada. It’s the same kind of logic that has seen the emissions cap on oil and gas as well as the carbon tax.”
If Canada wants to retaliate, Yager recommends putting a duty on the 1.7 billion cubic feet of natural gas imported by Ontario and Quebec from the northeastern United States.
“That would be the appropriate tit for tat response,” Yager says.
“You could build a nice pool of capital and clobber U.S. producers without driving a wedge between Alberta and the rest of the country.”
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