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Will Buying a Pipeline Really Help Trudeau Diversify Trade?

  • $3.5 billion Trans Mountain purchase seen as oil pivot to Asia
  • Yet conduit has supplied only two Asia-bound tankers this year
Bloomberg business news
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The promise of shipping more Canadian crude to fast-growing importers like China and India -- and relying less on the U.S. -- drew Prime Minister Justin Trudeau’s government into shelling out $3.5 billion for a pipeline project that was facing abandonment. Whether that gamble will pay off is anything but certain.

With U.S. President Donald Trump’s trade wars showing no sign of abating and pipeline bottlenecks damping prices for Canadian crude, the Trans Mountain pipeline expansion may seem like a godsend for the northern nation. But lost in the debate over the government’s purchase from Kinder Morgan Inc. is the fact that very few of the 300,000 barrels of oil and refined fuels a day the existing Trans Mountain line ships from Alberta to Canada’s Pacific coast are making their way to Asia.