VANCOUVER—Alberta’s threat to halt the flow of oil to British Columbia should be seen as political posturing — and businesses should “stay calm,” says one B.C. economist.

Alberta’s NDP government says Bill 12, passed earlier this month, would give the province new powers to restrict the flow of energy resources to B.C.

The legislation, known as the Preserving Canada’s Economic Prosperity Act, means Alberta can identify companies shipping products to B.C. — such as natural gas, crude oil and refined fuels like gasoline, diesel and jet fuel — and determine how that energy is shipped. The province could then place restrictions on pipelines, as well as transport via rail or truck.

“I see Bill 12 as a symbolic gesture from Alberta,” said Werner Antweiler, associate professor at UBC’s Sauder School of Business. He believes that the B.C. and Alberta governments are demonstrating to voters that they’re standing up for their respective provinces.

Businesses concerned about the potential effects of Bill 12 shouldn’t “panic,” he stressed. “Alberta really overstepped its jurisdictional boundary, intruding on what really is federal jurisdiction.”

The war of words and legislation started after B.C. said it would halt expansion of Kinder Morgan’s Trans Mountain pipeline in the province while it conducted a further study on the effects of a possible bitumen spill. That sparked a confrontation between B.C. on one side, and Alberta and the federal government on the other.

The Alberta government cannot unilaterally stop the flow of petroleum produced by private corporations and physically impede the flow across provincial boundaries, Antweiler explained. If B.C. were to file an injunction application, it would be “extremely likely” to succeed, he added.

Should Bill 12 be invoked, Antweiler said oil supplies would likely come from refineries in Washington state to make up for any shortfall from Alberta. Any additional cost from the rerouting would potentially mean consumers will have to pay a “small premium” at the pump, he said.

Attorney General David Eby revealed that B.C. has drawn up two “contingency” plans if Alberta decides to close the oil taps, which the opposition Liberals say would jack up gas prices and cripple the provincial economy.

Brian Ahearn, vice-president of the Canadian Fuels Association, which represents the petroleum refining sector, told StarMetro that the Calgary-based organization is concerned about the implementation of the bill and has asked to be included in the consultation process before regulations are written.

He doesn’t believe the export infrastructure through the U.S. is developed enough to deliver the volume that B.C. needs to meet its demand should Bill 12 be invoked.

However, Tim McMillan, president of the Canadian Association of Petroleum Producers, said he believes B.C.’s demand could be met through refineries in Washington state for an increased cost.

But, he said, B.C. Premier John Horgan is in an “untenable position.”

“I find it ironic that British Columbia’s premier is trying to source products from Washington state that has voted against a price on carbon, that brings its crude oil into those refineries by ship through the ... (Strait of) Juan de Fuca.”

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With files from David P. Ball, Catherine Griwkowsky, and Ameya Charnalia

Jenny Peng is a Vancouver-based reporter covering business. Follow her on Twitter: @JennyPengNow

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