EDMONTON -- Alberta Premier Rachel Notley is rethinking her stance on the Northern Gateway pipeline as her government and British Columbia work on a deal that could see a pipeline to the West Coast swapped for the purchase of electricity.
Notley's spokeswoman Cheryl Oates said Thursday that talks are ongoing.
"B.C. is really looking to export their hydroelectricity," said Oates. "Alberta does not have a market for B.C.'s hydroelectricity unless we get our product to tidewater. So there's a common understanding there."
Notley has been cool to the idea of the $6.5-billion Enbridge's Northern Gateway pipeline, which would take Alberta crude more than 1,000 kilometres to a marine terminal in Kitimat, B.C.
The line faces multiple regulatory hurdles and concerns about the port location, along with opposition from environmentalists and First Nations groups.
Oates said Notley was skeptical those hurdles could be overcome, but says the premier now sees progress.
"People have been working behind the scenes on some of those issues," said Oates.
"We've met with those people. We've heard from those people. They are sounding optimistic so we will continue to work with them, but in the end it's up to the company to make their pitch for the project."
Enbridge (TSX:ENB) is currently working to satisfy the 209 conditions included in its 2014 permit to build the pipeline.
B.C. Environment Minister Mary Polak said in a statement the hydroelectricity export could be particularly beneficial to Alberta, which plans to eliminate all coal-fired electricity by 2030.
"B.C. may be able to support Alberta's planned closures of coal-fired generating plants by exporting clean electricity," said Polak.
"That proposal is one that staff are exploring and discussing in both provinces."
But Polak said B.C. stands firm on the conditions it has on any new pipeline moving bitumen to the coast.
Those conditions include B.C. getting a fair share of the returns, along with addressing First Nations concerns and ensuring that the proper resources are in place to deal with disaster.
"When we established those conditions we knew we set the bar high, however, these are conditions that are achievable if the will is there, especially from senior governments and industry," said Polak.
"On the marine front, for example, there are gaps in marine response capabilities that the federal government will need to address."
Notley has been pushing hard for a new pipeline to get Alberta's oil to markets overseas so that its price is no longer tied to a sole customer, the United States.
Her focus has been on Energy East, a line that would take Alberta crude across Canada to refineries and ports in New Brunswick.
Oil remains the wellspring of Alberta's economy but the prolonged slump in world prices has drained billions of dollars from its bottom line.
The province forecasts a $10-billion deficit this year and again the year after that.
With files from Dirk Meissner in Victoria
