Smith Joins Poilievre’s Fight Against Carney’s B.C. Tanker Ban as Conservatives Say U.S. Refineries Are Profiting

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Alberta Premier Danielle Smith has added her voice to Pierre Poilievre’s campaign to dismantle the federal oil tanker restrictions on British Columbia’s North Coast, turning a long-running energy dispute into an immediate test for Prime Minister Mark Carney. At issue is Bill C-264, a Conservative private member’s bill that would repeal the 2019 Oil Tanker Moratorium Act, which Carney’s government has explicitly committed to preserving.

The political pressure has intensified because of a new proposal to move Canadian crude by rail to Prince Rupert for export overseas. Conservatives argue the existing rules leave Canadian producers overly dependent on American buyers and allow U.S. refineries to benefit from discounted Canadian crude. Yet the economics are more complicated than that argument suggests, especially as Ottawa simultaneously pursues another major West Coast oil pipeline designed to reach Asian markets.

Smith Turns Up the Pressure on Ottawa

Smith and Alberta Energy Minister Brian Jean formally backed Bill C-264 on October 26, placing Alberta squarely behind the federal Conservative effort. Smith argues Canada needs additional routes to overseas customers to improve the prices received for its energy, while Jean says Ottawa’s planned Pacific Link pipeline to southern British Columbia does not eliminate the case for additional export capacity on the North Coast.

Poilievre and Conservative MPs David McKenzie, Carol Anstey and Shannon Stubbs have meanwhile asked Carney to support C-264 at second reading. Their immediate target is a scheduled House vote on October 28. Conservatives favour full repeal, but their letter signals room for compromise: if Liberals allow the bill to advance, they say they would consider committee amendments focused more narrowly on allowing a proposed Prince Rupert export project to proceed. That turns what had been a broad ideological fight into a decision about a specific commercial opportunity.

What the North Coast Tanker Law Actually Prohibits

The phrase “tanker ban” can make the law sound broader than it is. Canada’s Oil Tanker Moratorium Act, which received Royal Assent in June 2019, prohibits tankers carrying more than 12,500 metric tonnes of crude oil or designated persistent oils from stopping, loading or unloading at covered ports and marine installations along British Columbia’s North Coast. The protected area includes Haida Gwaii and waters extending toward the Alaska border.

That distinction matters because the legislation is principally about using North Coast facilities for large-scale crude shipments, rather than a blanket prohibition on every tanker travelling through nearby Pacific waters. Smaller petroleum shipments needed by northern communities can continue. The law also requires the federal government to consider potential effects on constitutionally protected Indigenous rights when making decisions under it. Bill C-264 is unusually straightforward legislation: rather than redesigning individual provisions, its published text would repeal the Oil Tanker Moratorium Act outright.

A Prince Rupert Proposal Has Given the Fight New Urgency

The immediate catalyst is Strathcona Resources’ proposed crude-export route through Prince Rupert. The Calgary-based producer has floated a plan to move as much as 250,000 barrels a day by rail to a new marine terminal on the North Coast, from which crude could be shipped to overseas customers. Chairman Adam Waterous has said the company believes exports could begin in less than two years if regulatory and other obstacles can be overcome.

That timeline remains a company estimate, not an approved government construction schedule. A new export terminal would still have to be developed, and substantial regulatory, commercial and community work lies ahead. Strathcona does, however, have experience moving crude by rail. Waterous told Bloomberg that the company already transports as much as 80,000 barrels a day of its own and other producers’ oil toward the U.S. Gulf Coast through facilities in Alberta and Saskatchewan. Prince Rupert’s existing rail connections are a major part of the pitch.

Canada Remains Deeply Tied to the U.S. Oil Market

The Conservative argument begins with an economic reality that federal data confirms: despite recent diversification, the United States remains overwhelmingly Canada’s largest crude-oil customer. Canada exported approximately 4.3 million barrels of crude per day in 2025, according to the Canada Energy Regulator. Roughly 90.1%—about 3.9 million barrels a day—went to the United States.

The financial relationship is equally large. Canadian crude exports were worth about $140 billion in 2025, with approximately $126.1 billion tied to U.S. sales. The dependence has declined somewhat since the Trans Mountain Expansion began operating in 2024. The regulator says non-U.S. destinations accounted for about 9% of Canadian crude exports in 2025, compared with roughly 2% in 2021. That shift gives both Conservatives and the Carney government evidence for the same underlying argument: more Pacific access can give Canadian producers a wider pool of customers and reduce reliance on a single foreign market.

The Claim About U.S. Refineries Needs Some Context

Poilievre and his MPs argue that restricting Canadian access to overseas customers effectively transfers wealth to the United States because American refiners can purchase Canadian crude at a discount. There is a genuine commercial relationship behind that claim. The U.S. Energy Information Administration says relatively complex American refineries tend to favour heavy crude grades such as those produced in Canada, and Canada remained the largest foreign source of U.S. crude in 2025.

American refiners are also enjoying unusually strong market conditions in 2026. U.S. refinery utilization averaged more than 95% between May and September, the highest level for those months since 1998. Refining margins for gasoline, diesel and jet fuel have also been elevated. But those margins have been driven heavily by tight global supplies and international disruptions. The available data does not establish that Canada’s North Coast moratorium is responsible for those profits. The Conservative argument is therefore best understood as an argument about bargaining power and market access, not a demonstrated one-to-one transfer of refinery profits.

Trans Mountain Shows Why Additional Market Access Can Matter

There is stronger evidence behind the broader argument that transportation capacity can affect what Canadian producers receive for their oil. Before the Trans Mountain Expansion entered service, the price difference between West Texas Intermediate and Western Canadian Select averaged about US$18.70 a barrel from September 2023 through April 2024. After the expansion started operating, the differential averaged about US$12 a barrel between June 2024 and July 2025.

That narrowing does not mean every dollar of the old discount resulted from insufficient pipelines. Western Canadian Select is a heavier crude than WTI and costs more to refine, while transportation from landlocked Alberta also creates a structural price difference. Refinery demand can move the spread as well. Still, the Canada Energy Regulator specifically identifies constrained takeaway capacity as one reason the discount can widen. The Trans Mountain experience therefore strengthens the case that access to more buyers can improve producers’ negotiating position, even if it cannot eliminate the Canadian crude discount altogether.

Carney Is Expanding Oil Exports Without Opening the North Coast

The fight also exposes an unusual feature of Carney’s energy strategy: his government is not opposed to substantially expanding Pacific oil exports. On October 1, Ottawa designated Pacific Link as a project of national interest. Canada and Alberta are to share ownership equally, Trans Mountain is leading development, Pembina Pipeline is participating, and Indigenous communities are to be offered a minimum 10% ownership interest backed by government loan-guarantee programs.

Ottawa says Pacific Link could eventually add one million barrels a day of export capacity to growing Asian markets. Government estimates attribute 140,000 jobs and more than $20 billion in annual GDP to the project, although those are projections rather than realized economic results. Crucially, the proposed pipeline follows a southern B.C. route. That design allows Carney to pursue significantly greater oil exports while honouring the July Canada-B.C. agreement in which Ottawa promised to maintain the North Coast tanker moratorium “without alteration, suspension, or narrowing of scope.”

B.C.’s Election Has Changed the Political Landscape

The debate is unfolding just days after British Columbia’s October 24 provincial election produced a dramatic political shift. Elections BC’s preliminary count shows the Conservative Party leading in 63 districts, compared with 28 for the NDP and two for the Greens, with virtually all election-night ballot boxes reporting. Those numbers remain preliminary, however, because final counting is scheduled for November 6 through 10.

The incoming political environment could be considerably friendlier to energy development than the one in which Carney negotiated his July agreement with NDP Premier David Eby. B.C. Conservative Leader Lorne Doerkson welcomed Ottawa’s designation of Pacific Link earlier this month and said a Conservative government would seek a trilateral energy working group with Alberta and Ottawa. That does not automatically amount to support for repealing the North Coast moratorium, nor does an election result erase an existing federal law. It does mean the federal government may soon be dealing with a very different provincial partner as the pipeline debate evolves.

Coastal First Nations See More Than an Energy-Export Question

Any attempt to open Prince Rupert to large crude tankers would face another formidable political and legal reality: organized opposition from Coastal First Nations. In January, Coastal First Nations-Great Bear Initiative president Marilyn Slett said after meeting Carney that member Nations remained firmly opposed to oil tanker development on the Central and North Coast and Haida Gwaii. The organization repeated that opposition during earlier disputes over possible northern pipeline routes.

Supporters of the moratorium also argue that the coast already supports an economy worth protecting. The B.C. government estimated in July that the sustainable North Coast marine economy generates more than $3 billion annually, supporting livelihoods in fisheries, tourism, clean energy and environmental stewardship. It also credited Great Bear Rainforest agreements with helping create more than 1,400 permanent jobs and 140 businesses. Those estimates explain why the argument is not simply “development versus no development.” Different groups are arguing over which economic assets—and which risks—Canada should prioritize.

Wednesday’s Vote Is a Political Test, Not the End of the Fight

As of October 27, Bill C-264 remains at second reading in the House of Commons. The Conservatives say a recorded vote is expected Wednesday, October 28. If MPs reject it, the immediate repeal effort ends there. If the House allows it to proceed, the bill would move toward committee consideration, where Conservatives have already raised the possibility of negotiating something narrower than complete repeal.

Even a legislative breakthrough would not itself create Strathcona’s Prince Rupert terminal or put crude on ships. A commercial project would still require detailed planning, regulatory approvals, Indigenous consultation and engagement, environmental review, financing and infrastructure development. What the vote will reveal more immediately is whether Carney is willing to reconsider one of the clearest commitments in his agreement with British Columbia. Smith and Poilievre are betting that trade tensions with Washington and Canada’s desire for greater economic independence have changed that calculation. Ottawa’s own Pacific Link strategy shows it accepts the diversification argument; the unresolved question is whether the North Coast should be part of it.

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