As Alberta's energy crisis deepens, Alberta's NDP government has announced its intention to use taxpayer dollars to support the private sector building a new refinery in Alberta.
Next year, a new refinery is coming on stream in our province - the NWR Sturgeon Refinery - which will refine diluted bitumen producing up to 80,000 barrels a day.
However, that domestic upgrading comes at a high cost - Alberta taxpayers are on the hook for a debt service obligation of 75% of the debt, as well as a 30-year toll payer obligation which amounts to a total cost of $26 billion.
And that's the problem when the government decides to go where the private sector won't - it ends up costing taxpayers.
To be frank, if there was a business case to build a new refinery in Alberta, the private sector would have built one. Sinking taxpayer dollars into this project will simply drive our province deeper into debt.
We all know the answer to this problem: more pipelines.
However, there are other measures Alberta could take which would help address the current deep discounts Alberta oil is experiencing on its US sales.
One solution, advocated by former Wildrose leader Brian Jean, is for Alberta to create more domestic storage for oil and gas, allowing it to avoid selling its products when the price differential balloons due to changes in US refining capacity or other price-influencing measures.
The strategic petroleum reserve in the United States is an example of using storage to address concerns with either oil volume or price in the market, and it is an idea that could be replicated here in Alberta for relatively little cost.
Moreover, unlike a refinery, new storage could be brought online quite quickly, addressing the price issues affecting Western Canadian Select oil in the near term.
While it is clear the Alberta NDP seriously miscalculated when they decided to become allies with Liberal PM Justin Trudeau and his carbon tax agenda, it is now clear that they don't know how best to help Albertans during this difficult time.
But using taxpayer dollars to pay for a project that the private sector does not deem to be a good investment isn't the right step for Albertans.
Alberta Can't Wait