• Sat. Jun 19th, 2021

Keystone XL is cancelled — so now what? | CBC News


Jun 10, 2021

The announcement that TC Energy is cancelling the problem-plagued Keystone XL pipeline challenge wasn’t an enormous shock.

It appeared unlikely the Calgary-based firm may dig its manner out of U.S. President Joe Biden’s determination final January to yank its cross-border allow. 

After evaluating its choices, it seems TC Energy reached that very same conclusion on Wednesday.

But this week’s determination to tug the plug does not put to relaxation a few key questions which have been hanging over the challenge — not only for Keystone XL, however for the Alberta authorities, environmental teams and different pipeline tasks.

Can Alberta nonetheless get some a refund? 

Last 12 months, Alberta invested $1.5 billion, plus mortgage ensures, in Keystone XL to assist kick-start a challenge beset by authorized disputes and protests within the U.S.

The cash was aimed toward getting building began on the Canadian leg of the challenge, which it did for a time.

U.S. President Joe Biden indicators his first govt orders within the Oval Office of the White House on Jan. 20, together with one which cancelled the allow for Keystone XL. (Evan Vucci/The Associated Press)

On Wednesday, the province stated the fabric value to the federal government was $1.three billion, however that it wasn’t giving up on retrieving what it may.

“As stated, we remain committed to recouping the government’s investment in the project on behalf of Albertans,” a authorities spokesperson stated in an e mail.

That could imply starting the liquidation means of pipe and different belongings to assist offset a number of the prices. But as CBC News reported final week, the pipe that’s already underground will keep there for now.

There may nonetheless be a marketplace for what’s left over, however how far that might go towards recouping Alberta’s funding is one other unknown at this level.

Dennis McConaghy, a former TC Energy govt who has authored books on power points, thinks there might be a marketplace for the spare elements.

“The pipe will be useful,” he stated. “The question about being able to salvage any of the expenditures they may have made on pumps will depend on whether those specific kinds of pumps can find markets somewhere in the world. Eventually, that will probably happen.”

What is not recoverable are the bills paid out on camps, engineering and the workforce, he stated.

McConaghy speculated that the formal termination of the challenge could assist the corporate with both a few of its salvage actions or litigation — if that is one thing it pursues.

What about authorized motion?

In referencing its dedication to recoup its funding, Alberta’s United Conservative authorities additionally famous “we continue to examine all our legal options regarding the termination of the Keystone XL project.” 

Using historical past as a information, it may attempt to do that in a few methods.

TC Energy filed a lawsuit in U.S. Federal Court in Texas in opposition to the Obama administration after it halted the challenge in 2015, asserting that then-President Barack Obama’s determination to disclaim building of Keystone XL exceeded his energy below the U.S. Constitution. 

That lawsuit was in the end suspended after Donald Trump inked the required building allow to get the challenge shifting once more shortly after profitable the White House.

James Coleman, an affiliate professor of power regulation at Southern Methodist University in Dallas, stated he’ll be watching to see if Canada and TC Energy are weighing a problem below the North American Free Trade Agreement (NAFTA).

Though that commerce settlement was succeeded final 12 months by the Canada-U.S.-Mexico Agreement, Coleman stated there is a three-year window the place a declare will be made for an funding made below NAFTA.

“They could bring a claim under NAFTA and say they were treated in a discriminatory fashion,” Coleman stated. “With that said, nobody’s ever won a NAFTA suit against the United States. So I think most people would say your odds of success are less than 50-50.”

What does this imply for Jason Kenney’s UCP authorities?

On the identical day the information broke concerning the cancellation of the Keystone challenge, Kenney additionally shared {that a} $1.three billion hydrogen challenge is within the works for Edmonton.

But solely a type of tales made information within the Wall Street Journal, the New York Times and CNN.

Alberta Premier Jason Kenney marked the beginning of building of the Keystone XL pipeline within the province, within the city of Oyen, final summer season. (Flickr/Alberta Government)

When Kenney made his huge guess on Keystone XL final 12 months, it was in step with his marketing campaign promise of jobs, pipelines and a greater economic system. It additionally got here at a time when the oilpatch was hit arduous by a deep plunge in crude costs.

The Alberta authorities stood by that call on Thursday, because the NDP once more referred to as on them to launch the complete particulars of the funding settlement.

“There’s full transparency,” Energy Minister Sonya Savage advised the legislature. “We supported this pipeline because we believe it would have brought higher prices for Alberta oil, increase oilsands production and brought us $30 billion a year in royalties.”

Regardless, it is one other blow on a authorities precedence.

“It’s just another cumulative thing,” stated Duane Bratt, a political scientist at Mount Royal University in Calgary.

“If you simply pull off the power file — the entire ‘struggle again’ technique, the Allen inquiry, the struggle room, the funding in Keystone, the carbon tax struggle — there isn’t a wins there.”

Setting politics apart, the main target for Alberta’s oilpatch might be seeing completion of the Trans Mountain enlargement pipeline to Burnaby, B.C., and Enbridge’s Line three substitute pipeline connecting to Superior, Wis.

“That just really homes in the magnifying glass,” stated Thomas Kirk-Pearson, a senior analysis affiliate with power knowledge analytics agency Enverus.

“Without those projects, you’re going to have a pretty hard limit on how high production can go in Western Canada.”

Opponents of the Keystone XL pipeline display on the Dodge Street pedestrian bridge throughout rush hour in Omaha, Neb., in 2017. (Nati Harnik/Associated Press)

Both tasks face some sturdy opposition over concern round their environmental and local weather change affect — and this week’s information is anticipated to rally assist to further protests.

“This is huge for people who’ve been resisting new fossil fuel infrastructure and calling for alternatives, because this was the first really big pipeline battle,” stated Keith Stewart, a senior power strategist with Greenpeace Canada.

Beyond that, he stated, Keystone additionally knowledgeable how present and future environmental campaigns could possibly be executed.

“The Keystone fight represented a shift in strategy from the environmental movement and an increasing recognition that we have to work in partnership with, and often behind the leadership of, Indigenous communities.”

No doubt, trade, authorities and environmental leaders have realized a lot from Keystone XL’s lengthy odyssey. And the teachings probably will not have ended after this week.

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