Alberta economist estimates province losing out on $7B because of pipeline capacity, but B.C. expert disagrees

A University of Calgary economist estimates Alberta is losing out on $7 billion annually because of a lack of pipeline capacity, however an independentB.C. economist says that analysis is thin on details and filled with misinformation.

Kent Fellows, an economist with the U of C'sSchool of Public Policy, issued a one-page briefon TuesdaytitledEnergy and Environmental Policy Trendsthat said the provincial and federal governments, along with industry, are losing $13 billion every year because of the lack of pipeline capacity.

Fellows said the analysis is based on readily available public data and argues the lack of pipelines is creating a wider price differential and therefore price discount for Canadian oil.

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These figures are meant to back up the argument for the need for more pipelines.

"It gives us a little bit better bargaining power with some of our export partners if they know that it's a little bit easier for us to get these things to market," Fellows said.

"Fundamentally it will just bring down some of those cost differentials that we're losing because of bargaining power."

However, B.C. economist Robyn Allan argues the price differential always fluctuates, and the most recent widening has more to do with pipeline failures than pipeline capacity.

"It's not a report, it's a one-page brief that regrettably doesn't have good research behind it.

Despite of the lack of detail in his report, Fellows says he stands by his "ballpark figures."

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