Posted on 11/28/2024 8:22:41 AM PST by george76
Both Alberta Premier Danielle Smith and U.S. President-elect Donald Trump want to revive the long-dead cross-border Keystone XL pipeline project, but is that feasible?
A major challenge in resuscitating the project will be ginning up enough political will and corporate determination to wade through the legal and regulatory requirements to begin construction, not to mention tackling the growing anti-fossil fuel advocacy across the continent.
Former owner TC Energy terminated the project in June 2021. The pipeline system is now part of the spinoff company South Bow, and that adds to the challenges of resurrecting the Keystone XL expansion.
On Nov. 12, California water solutions company Cadiz announced the purchase of 180 miles of 36-inch steel pipe from the terminated Keystone XL project. The pipe will be transported from where it is stored in North Dakota and repurposed to pump groundwater from deep under the Mojave Desert into major water networks in the Southwestern United States.
The timing of the purchase announcement, just a week after the U.S. election, indicates that the pipe was going to be sold off regardless of whether or not pro-energy Republicans came to power with a mandate to reduce regulatory burden on fossil fuel projects.
...
Trump has promised to reinstate the project on his first day in the White House. The last time he attempted to revive Keystone XL was in 2017, when he issued a permit reversing the Obama administration’s rejection of the project in 2015. The project was first proposed in 2008 by TC Energy, then called TransCanada.
The Trump administration saw Keystone XL as an opportunity to boost economic growth. The pipeline would have run 1,947 kilometres from Hardisty, Alta., to Steele City, Neb., and have the capacity to carry 830,000 barrels of crude oil per day from Western Canada’s oilfields to American Gulf Coast refineries.
The goal was to get the pipeline built quickly. What followed was years of wading through legal quagmire, finally cut short by the Biden administration’s decision to axe the project in 2021.
In November 2018, Montana judge Brian Morris issued an order blocking construction of the Keystone XL permit pending further study of environmental impacts. In February 2019, the same judge denied a request to green-light the construction of worker camps for the project.
In response, the Trump administration revoked its first permit and issued a second one in March 2019. Things were looking up for proponents of the project until Morris revoked a key water-crossing permit, suspending construction efforts. The U.S. Supreme Court upheld that decision in July 2020, and the final nail was driven into the coffin when the newly elected Biden administration killed the project in January 2021.
Risks..
Issuing a pipeline permit is easy—navigating the labyrinthian legal process that follows is the hard part. If the Trump administration issues yet another Keystone XL permit next year, the legal battle could be initiated once more with another round of lawsuits from environmental groups.
With lengthy delays comes the additional possibility that the project may be cancelled before construction begins, if Trump’s last term is followed by a Democratic administration that is less supportive of large fossil fuel projects.
Since Keystone XL is a project on both Canadian and American soil, reviving it would require political will on both sides of the border. The federal government in Canada had been supportive of the project, but the main proponent was Alberta. Premier Smith’s government would probably not have to contend with the same legal hurdles as the Trump administration. It would, however, have to make the potentially difficult decision of whether to back the project with taxpayer funds as former Alberta Premier Jason Kenney’s government did.
In a March 2020 announcement that was largely overshadowed by the pandemic, the Kenney government declared that it would provide a $1.5 billion equity investment in the Keystone XL project, explaining that the pipeline was “expected to be completed and in service in 2023”.
Kenney described the move as “a wise and prudent investment” that would eventually yield a net return of over $30 billion. After the pipeline was cancelled the following year, the Alberta government reported that the investment had resulted in a loss of $1.3 billion.
A similar situation has been playing out with the federal government’s decision to buy the Trans Mountain pipeline expansion project from Kinder Morgan Canada for $4.5 billion in 2018. The purchase has come under fire for overruns, with the estimated cost of building the pipeline rising significantly from $12.6 billion in 2020 to $30.9 billion in 2023.
The controversy continues now that the project is up and running. According to a Nov. 8 report by the Parliamentary Budget Officer, the pipeline might be worth between $29.6 billion and $33.4 billion, while the cost of building it came in at $34.2 billion. Selling the project, which the government has long promised to do, may therefore mean a financial loss.
‘De-risking the Project’..
The precedent set by the Kenney government’s investment in Keystone XL and subsequent loss, as well as the cost overruns and delays after Ottawa’s purchase of the Trans Mountain pipeline, puts Smith in a difficult situation in regard to embarking on a similarly high-risk investment.
Smith said on Nov. 25 that her government is looking to get more Alberta oil and gas to the United States in ways that would carry less risk than investing directly in a cross-border project.
“Maybe de-risking the project involves having an American partner, an American pipeline company, partner with our companies here,” she told reporters during an event at the Leduc No. 1 oil discovery site south of Edmonton.
“We just don’t think the best way of doing it is putting government dollars into it, but we think there are other things we can do to change the risk profile.”
Two major factors would need to come together to get the Keystone XL project started up again: renewed corporate enthusiasm and sufficient political will on the part of the United States and Alberta governments to tolerate the risk of another failed attempt.
Even if these factors come together, the project would need to successfully run the legal gauntlet of environmental challenges and then complete construction before a potential future fossil fuel-skeptical Democratic administration comes to power.
Despite the many challenges, the reinvigorated enthusiasm around Keystone XL could signal a period of renewed cooperation between Alberta and the United States stemming from a shared worldview on the energy industry.
Unfortunately, it might be. Continent wide projects takes a huge amount of cooperation and organization. Thousands of companies wrote into their calendars their time on the projects and this was right across the country and continent.
I don’t know if such a moonshot project can be restarted on the fly.
I don’t know but I’m holding on to my Energy Transfer [ET] stock just in case. It went up 4% in one day on the rumor.
Trump owes blacks. Specifically the men. There are a lot of big strong ones out there that could do a hard job like drilling that pays very well and comes in 3 week spurts. The time off between those exercises could allow them the time to win over more of them politically speaking. It won’t be easy-not meant to be.
What a rotten way to run a country.
Now: Republicans — BUILD!
In 4 years: Democrats — STOP BUILDING!!
In 8 years: Republicans— BUILD!!!
In 12 years: Democrats — STOP!!!!
No firm in its right mind would build under those whipsaw conditions. Thus, nothing gets built and the Democrats always win.
How the hell do you stop this insanity?
“...not to mention tackling the growing anti-fossil fuel advocacy across the continent.”
Nope. Ain’t happening. There are advocacy groups comprised of wackos, who like to drive or fly to their meetings and protests, with all kinds of transportation they use dependant on fossil fuels.
Danielle Smith is Canada’s female Trump. She’s awesome.
Different players this time, and I’m betting more Americans want cheaper energy, are aware of the U.S. no longer being energy independent as it was before. Buying oil from foreign countries is senseless. Borrowing from the National Reserve is just as stupid. It also gives us a tremendous edge against our not so friendly foreign countries that would like nothing better than to make us completely dependent on them and eventually own us. The only thing stopping this is ignorant politicians who stubbornly think they are saving the climate and environment. They don’t look at the facts. Facts: Trucking oil is much more expensive, dangerous, and much worse for the environment ad bedides, I’ve seen pictures of caribou and other wildlife resting underneath the pipes, using them for shelter.
How about front loading all the building on the sites and areas that somehow intersect with areas that require government approval. Get that done in four years.
It’s not just oil/gas pipelines, it’s any form of energy production that does not involve wind and solar.
Look at how time consuming and costly nuclear power plants are to build, at one time nuclear plants could be built economically, now with all the regulations and red tape, it’s nearly impossible, same thing for coal mining, oil refineries, etc.
Proposing to build some money losing huge solar or wind farm, that will get fast tracked with government subsidies thrown in to make the deal better.
“How the hell do you stop this insanity?”
The Keystone Pipeline shall be considered a national priority project.
Any legal action, such as filing a lawsuit, that might impede that project shall require the signed authorizations of the minority and majority leaders of both houses of Congress.
Impediment in violation of this law shall be punished by up to one year in federal incarceration.
Last I heard...Canada was excited about the possibility.
I think that would work. The pipeline companies could have it finished within four years if they could get their act together by January 21st, 2025.
It was on schedule to be finished in August 2020, when Bidon cancelled the project.
And don’t forget the CO2 sequestration projects.
But you have to stop the leftist judges like Brian Morris who kill these projects. These insane judges need to be weeded out. That takes a lot of time.
Well, you can’t argue with success, and Trump knows how to be successful once again. The walls are going to go up along the border and fracking, drilling, and pipelines will be built. As far as democrats getting back in office in 4 years from Jan 20th, they better come up with someone who is more with reality. They have nothing but puppets, pawns, grifters, half assed celebrities, and those of the flamboyant community. With control of the senate, congress, and the presidency I think the pipeline will happen this time. Better for everyone, even the dems, but they would never admit it.
“...How the hell do you stop this insanity?...”
Don’t elect democrats.....
“I’ve seen pictures of caribou and other wildlife resting underneath the pipes, using them for shelter.”
They are using them for warmth. That oil is warm as it runs through.
They built the pentagon in like 18 months. Top to bottom. They can do this.
Rewrite the regs. Get Congressional authorization to do so, if need be. Declare National Emergency due to need to cut Pooty off at the knees, if need be.
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