Why TransCanada doesn’t talk much about Keystone XL these days
WASHINGTON — Russ Girling knows now that a presidential pipeline permit from Donald Trump won’t buy him a cup of coffee in Omaha.
Nor will it permit the CEO of TransCanada Corporation to start digging a 1,900-kilometre trench across five states and two provinces for the long-delayed and bitterly controversial Keystone XL pipeline, intended to funnel 800,000 barrels a day of gooey, carbon-laden bitumen from Alberta to American refinery complexes on the Gulf of Mexico.
Instead, Mr. Trump’s permission — issued with great fanfare last January 24 — wasn’t the final say on the subject, any more than former President Barack Obama’s 2015 rejection of the project as a threat to the planet. Both decisions left Keystone XL trapped in a legal morass with an uncertain future.
Just as Mr. Girling slapped the Obama White House with a $15 billion lawsuit and threatened to invoke NAFTA to force the next Oval Office tenant to allow Canada’s crude to flow across the United States, so too have opponents of the ‘tar sands’ clogged the regulatory process with lawsuits and made Keystone XL a political issue.
Nebraska’s November ‘approval’ of TransCanada’s route turned out to be just another setback to the Canadian oilpatch’s dream of finding cost-effective means to get Alberta’s expensive-to-extract bitumen to world markets. Nebraska didn’t approve TransCanada’s route but rather an alternative path that adds length, complexity, cost and, possibly, years of additional uncertainty to the project. Nebraska regulators also unanimously rejected the company’s effort to retroactively apply for the approved route.
So Mr. Girling faces a stark choice. He can toss in the towel and admit that Keystone XL has become so politically toxic, so controversial, that spending years and more millions of dollars seeking approval wouldn’t be worth the effort.
Or he can double-down and hope to start digging within two or three years — the minimum period even optimistic backers of Keystone XL believe it will take to surmount the remaining regulatory and legal hurdles. Add on another two or three years for construction and you get a sense of when Keystone XL might (emphasis on might) be operational. Mr. Girling claims to be “very encouraged” by his prospects for lining up sufficient binding contracts — despite low oil prices and the growing glut of American domestic production that will transform the United States from a major importer to a net oil exporter in less than a decade.
But pipelines take decades to pay their investors back. TransCananda still needs to find billions in financing, predicated on whether Alberta’s producers will still be financially viable in 2040 or 2050.
https://ipolitics.ca/2017/12/29/transcanada-doesnt-talk-much-keystone-xl-days/
