State Department report on Keystone XL set for release

By The Canadian Press - Friday, March 1, 2013 at 3:11 PM - 0 Comments

WASHINGTON – The U.S. State Department is poised to release its long-awaited environmental assessment of TransCanada’s (TSX:TRP) Keystone XL pipeline.

U.S. environmental groups say it will downplay the risks of the pipeline.

Sources say the report, apparently set for release later today, acknowledges that Alberta’s oilsands are carbon-intensive.

But the State Department assessment also apparently makes clear that all modes of transportation are risky and the pipeline itself isn’t any more of a threat to the environment, according to a source at the environmental group 350.org.

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South leg of Keystone XL from Oklahoma to Texas hits halfway mark, company says

By The Associated Press - Saturday, February 23, 2013 at 1:53 PM - 0 Comments

OKLAHOMA CITY – While the debate continues over whether the United States will approve a proposed oil conduit from Canada to the Gulf Coast, the segment from Cushing, Okla., to the Texas Gulf Coast is halfway toward completion and could be transporting oil by the end of the year.

President Barack Obama travelled to Oklahoma nearly a year ago to tout construction of TransCanada’s Keystone XL pipeline from the Cushing oil hub to Houston-area refineries. A decision on whether to allow the longer pipeline awaits the results of a U.S. State Department review that is necessary because the oil would be carried across an international border.

Nearly 4,000 workers in Oklahoma and Texas are aligning and welding a 485-mile section, TransCanada spokesman David Dodson told The Associated Press.

“We’re right at peak right now,” he said. “We hope to have it in operation by the end of this year.”

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Carbon pricing: Beyond the talking point

By Aaron Wherry - Friday, February 22, 2013 at 3:15 PM - 0 Comments

Michael Den Tandt wonders if the Conservatives will have to stop freaking out about the NDP’s cap-and-trade proposal if they hope to see the Keystone XL pipeline approved by the United States. If the Conservatives think likewise, we’ll presumably see a different tone on Monday when the House returns to business (the Conservatives certainly weren’t shying away from their preferred talking point when the House was sitting a week ago).

Meanwhile, China is talking about a carbon tax and Ontario is thought to be moving forward with cap-and-trade and here is what the woman thought to be President Barack Obama’s choice to lead the EPA told an audience of regulators yesterday.

Addressing a room full of familiar faces at a workshop of state and federal regulators, McCarthy applauded local efforts, such as the nine-state carbon cap-and-trade program in the Northeast United States, for showing Washington a path forward on combating climate change.

“At the EPA we will do our part to build on your success,” she said at the Georgetown University Law Center. “We can find a way instead of having national solutions…to open up opportunities for states to use all the flexibility, the ingenuity, the innovation that you have shown could be done, and just simply get it done.”

Stephen Gordon talks to Global about what international developments might mean for Canada.

As the rest of the world starts to put a price on carbon, any Canadian exporter is going to have start paying that price regardless of where it is located,” said Laval University economics professor Stephen Gordon. Carbon taxes are usually applied to imports as well, so local producers are not disadvantaged, according to Gordon.

The U.S. is Canada’s largest trading partner and accepted $330.1 billion worth of exports from Canada in 2011. China ranks number three when it comes to Canada’s largest export destinations, accepting $16.8 billion in exports in 2011. “If Canadian exporters are already paying for it why not send that tax revenue to Ottawa instead of Washington or Beijing,” Gordon said.

And PJ Partington compares coal regulations in Canada and the United States.

The U.S. ambassador has made it crystal clear that as America steps up its climate action it expects us to do better too. The new line from the Harper government is that we’re already there, particularly on curbing emissions from coal power. Foreign minister John Baird recently suggested “maybe the United States could join Canada” on “taking concrete direct action with respect to dirty, coal fired electricity generation,” adding that “we’re the only country in the world that’s committed to getting out of the dirty coal electricity generation business.”

Sadly, Canada isn’t the shining example of coal-curbing excellence that Harper’s ministers are claiming. When it comes to regulating greenhouse gases (GHGs) from coal power, we’re doing about the same as our neighbours to the South — and may well be eclipsed before too long. While coal power is America’s biggest source of GHGs, accounting for over a quarter of national emissions in 2010, it accounted for about 11 per cent of Canada’s in the same year. As for “getting out of the dirty coal electricity generation business,” Canada won’t be fulfilling that commitment until 2062.

John Kerry comes out swinging on climate change; ominous sign for Keystone XL

By Lee-Anne Goodman, The Canadian Press - Wednesday, February 20, 2013 at 4:43 PM - 0 Comments

WASHINGTON – In yet another potentially ominous sign for TransCanada’s Keystone XL pipeline, John Kerry used his first major address as secretary of state on Wednesday to make an urgent call for comprehensive action on climate change.

“We as a nation must have the foresight and courage to make the investments necessary to safeguard the most sacred trust we keep for our children and grandchildren: an environment not ravaged by rising seas, deadly superstorms, devastating droughts, and the other hallmarks of a dramatically changing climate,” Kerry said in a wide-ranging speech at the University of Virginia.

“If we waste this opportunity, it may be the only thing our generation — generations — are remembered for. We need to find the courage to leave a far different legacy.”

While Kerry made no mention of Keystone XL specifically, his State Department will soon decide the $7 billion pipeline’s ultimate fate because it crosses an international border.

Keystone XL, which would carry bitumen from Alberta’s carbon-intensive oilsands to the U.S. Gulf Coast, is considered a symbol of “dirty oil” by American environmentalists. They’re stepping up their efforts to urge U.S. President Barack Obama to make good on his recent rhetoric on climate change by rejecting the pipeline.

There have been signals that the pleas of environmentalists are not falling upon deaf ears at the White House.

David Jacobson, the U.S. ambassador to Canada, told The Canadian Press last week that Obama’s vow to take aggressive action on climate change during his recent State of the Union address was meant in part as a challenge to Canada.

John Baird, Canada’s foreign affairs minister, responded a few days later that the U.S. could stand to follow Canada’s lead on several climate change fronts, in particular on coal.

“We’re the only country in the world that’s committed to getting out of the dirty coal electricity generation business,” Baird said. “These are real meaningful steps that will either meet or even exceed the work that’s been done thus far in the United States.”

Kerry’s remarks on Wednesday came less than two weeks after his meeting at the State Department with Baird. He was non-committal about Keystone in his joint news conference with Baird, and was rumoured to have been tepid about the pipeline during their private meeting.

The former Massachusetts senator, a fierce climate hawk during his 28 years in Congress, said he hoped to use his role as America’s No. 1 diplomat to promote green energy technologies given they could propel U.S. industries into the “next great revolution in our marketplace.”

“We need to commit ourselves to doing the smart thing and the right thing and to truly take on this challenge, because if we don’t rise to meet it, then rising temperatures and rising sea levels will surely lead to rising costs down the road,” he said.

There has been increasing speculation in the U.S. capital that the Obama administration might want to exact something in exchange for Keystone approval, like a rumoured greenhouse gas emissions levy that would be imposed at the border and could raise much-needed revenue for the United States.

Obama rejected TransCanada’s previous permit application due to concerns about the impact on an ecologically sensitive area in Nebraska. But Nebraska Gov. Dave Heineman, previously a Keystone foe, recently gave his blessing to TransCanada’s new route around a crucial state aquifer.

The State Department’s latest environmental assessment of the new route is expected soon. With that report in hand, Kerry is expected to make the final decision on the pipeline in the spring.

The CEO of Cenovus, a Calgary oil company with two oilsands projects, recently said he wasn’t concerned by remarks from either Kerry or Obama on climate change in the past few weeks.

“One of the comments that John Kerry had made actually gave me a great deal of optimism,” Brian Ferguson told The Canadian Press.

In his confirmation hearings, Ferguson said, Kerry pledged “that he’d be making decisions not based on ideology, but based on science and fact, and if his decisions are based on science and fact, then I’m highly optimistic that Keystone XL will get approved.”

The Keystone dilemma

By Paul Wells - Tuesday, February 19, 2013 at 12:13 PM - 0 Comments

U.S. Secretary of State John Kerry, right, speaks during a news conference with Canadian Foreign Minister John Baird last week. Talks included the Keystone XL pipeline project. (J. Scott Applewhite/AP)

We sure picked a good day to be discussing the future of Keystone XL with CPAC and a blue-chip guest list in Washington. (Showtime is 7 p.m. and you can watch it all on CPAC. We’ve got Gary Doer and John Manley and many more, and Colleague Luiza Ch. Savage will keep them all honest. I’m writing from the U.S. departure lounge at Ottawa airport, and right now it looks like I’ll probably get to the Newseum before cameras roll.)

Fifteen months after Barack Obama delayed a decision on the Keystone XL pipeline, it is getting time to stop delaying. Continue…

Updated: Canadian pipeline project draws ire of climate change protesters in Washington

By The Canadian Press - Sunday, February 17, 2013 at 7:12 PM - 0 Comments

ASHINGTON – Thousands of people gathered in the U.S. capital on Sunday to urge U.S. President Barack Obama to honour his recent climate change vows, with TransCanada’s proposed Keystone XL pipeline the protest’s most popular whipping boy.

Organizers billed the rally, held at the foot of the Washington Monument on the National Mall, as the biggest climate protest in American history.

But despite claims by organizers that 50,000 people were in attendance, the crowd appeared smaller, with one police officer in attendance unofficially pegging it at about 10,000 as it got under way.

Nonetheless, despite the brisk, blustery day, steady streams of people made their way from surrounding subway stations to spill onto the mall, many of them waving anti-Keystone signs.

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Canada’s cred on climate change won’t need much work: enviro minister

By Andy Blatchford - Friday, February 15, 2013 at 6:45 PM - 0 Comments

MONTREAL – Canada’s environment minister says it won’t take much work to boost the country’s credibility in the United States when it comes to climate change.

Peter Kent made the remark in Montreal on Friday, a couple of days after the Obama administration challenged Canada to act more aggressively on climate change.

His comment came as Canada desperately seeks ways to get Alberta’s oilsands bitumen to markets, including the controversial Keystone XL pipeline project to pump oil though the U.S.

The pipeline debates appear to be catapulting climate change back up the political agenda, with the future success of Canada’s oil industry potentially hinging on the outcome.

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Sierra Club leader, others arrested at White House protest against oil pipeline from Canada

By The Associated Press - Wednesday, February 13, 2013 at 3:20 PM - 0 Comments

WASHINGTON – Prominent U.S. environmental leaders, including the head of the Sierra Club, were arrested Wednesday after tying themselves to the White House gate to protest the Keystone XL oil pipeline from Canada.

Executive director Michael Brune is the first Sierra Club leader in the group’s 120-year history to be arrested in an act of civil disobedience. The club’s board of directors approved the action as a sign of their opposition to the $7 billion pipeline, which would carry oil derived from tar sands in western Canada to refineries along the Texas Gulf Coast.

Activist Bill McKibben, actress Daryl Hannah, civil rights leader Julian Bond and environmental lawyer Robert F. Kennedy Jr. also were arrested Wednesday, along with several dozen other activists.

The protesters are demanding that President Barack Obama reject the pipeline, which they say would carry “dirty oil” that contributes to global warming. They also worry about a spill.

Many business and labour groups support the 1,700-mile (2,736-kilometre) pipeline as a source of jobs and a step toward North American energy independence.

The 4-year-old project has become a flashpoint in the debate over climate change, with opponents labeling it a “carbon bomb” that could trigger global warming. Supporters call that rhetoric overblown and say Obama should approve the pipeline as part of his “all of the above” energy policy, which encourages a wide range of domestic energy development.

In an interview before his arrest, Brune said it was important that he engage in civil disobedience to show the depth of opposition to the pipeline among Sierra Club members. The club is the oldest and largest environmental group in the United States.

“We want to send a strong message that we expect the president’s ambitions to meet the scale of the challenge and reject a pipeline that carries dirty, thick oil” that contributes to global warming, Brune said. The president’s supporters want Obama to “fight with both fists” against climate change, Brune said.

Obama has called climate change a serious threat and urged Congress to combat the phenomenon in his State of the Union speech Tuesday night. If Congress fails to act, he will use executive authority to take steps to cut greenhouse gas pollution and encourage increased use of cleaner sources of energy, Obama said.

Obama has twice thwarted the Keystone XL pipeline because of concerns over its route through sensitive land in Nebraska, but has not indicated how he will decide on the pipeline now that Nebraska’s governor has approved a new route. The State Department has authority over the project, because it crosses an international border, but most observers expect Obama to make the final decision.

Wednesday’s protest came hours before the American Petroleum Institute, the largest lobbying group for the oil industry, again urged Obama to approve the project. The group said it will pay for ads supporting the pipeline and will mobilize grassroots events across the country urging Obama’s approval.

Decoding what Obama said about energy and climate

By Luiza Ch. Savage - Tuesday, February 12, 2013 at 11:22 PM - 0 Comments

During his State of the Union address, Obama made the case for action on climate change but proposed few concrete plans. The president said his administration would speed up approvals of domestic oil and gas permits to take advantage of America’s domestic energy boom.

He called for a “market-based solution” to climate change and referred to a past attempt at cap-and-trade legislation. But such legislation is likely a non-starter in the Republican-controlled House of Representatives — so Obama also said he willing to take unilateral executive actions “to reduce pollution.”

He didn’t give specifics about what unilateral steps his administration could take without legislation passed by Congress, but environmentalists have been asking the administration to regulate carbon emissions from existing power plants — especially those that burn coal — currently the largest source of carbon emissions in the U.S.

Industry says that the costs of upgrading existing plants will be too high — but there is speculation a carbon rule or standard could be the trade-off for an eventual decision to approve the Keystone XL pipeline (which was not mentioned at all in his speech).

Here is what Obama said about energy in his speech:

“After years of talking about it, we are finally poised to control our own energy future.  We produce more oil at home than we have in 15 years.  We have doubled the distance our cars will go on a gallon of gas, and the amount of renewable energy we generate from sources like wind and solar – with tens of thousands of good, American jobs to show for it.  We produce more natural gas than ever before – and nearly everyone’s energy bill is lower because of it.  And over the last four years, our emissions of the dangerous carbon pollution that threatens our planet have actually fallen.

“But for the sake of our children and our future, we must do more to combat climate change.  Yes, it’s true that no single event makes a trend.  But the fact is, the 12 hottest years on record have all come in the last 15.  Heat waves, droughts, wildfires, and floods – all are now more frequent and intense.  We can choose to believe that Superstorm Sandy, and the most severe drought in decades, and the worst wildfires some states have ever seen were all just a freak coincidence.  Or we can choose to believe in the overwhelming judgment of science – and act before it’s too late.

“The good news is, we can make meaningful progress on this issue while driving strong economic growth.  I urge this Congress to pursue a bipartisan, market-based solution to climate change, like the one John McCain and Joe Lieberman worked on together a few years ago.  But if Congress won’t act soon to protect future generations, I will.  I will direct my Cabinet to come up with executive actions we can take, now and in the future, to reduce pollution, prepare our communities for the consequences of climate change, and speed the transition to more sustainable sources of energy.

“Four years ago, other countries dominated the clean energy market and the jobs that came with it.  We’ve begun to change that.  Last year, wind energy added nearly half of all new power capacity in America.  So let’s generate even more.  Solar energy gets cheaper by the year – so let’s drive costs down even further.  As long as countries like China keep going all-in on clean energy, so must we.

“In the meantime, the natural gas boom has led to cleaner power and greater energy independence.  That’s why my Administration will keep cutting red tape and speeding up new oil and gas permits.  But I also want to work with this Congress to encourage the research and technology that helps natural gas burn even cleaner and protects our air and water.

 ”Indeed, much of our new-found energy is drawn from lands and waters that we, the public, own together.  So tonight, I propose we use some of our oil and gas revenues to fund an Energy Security Trust that will drive new research and technology to shift our cars and trucks off oil for good.  If a non-partisan coalition of CEOs and retired generals and admirals can get behind this idea, then so can we.  Let’s take their advice and free our families and businesses from the painful spikes in gas prices we’ve put up with for far too long.  I’m also issuing a new goal for America: let’s cut in half the energy wasted by our homes and businesses over the next twenty years.  The states with the best ideas to create jobs and lower energy bills by constructing more efficient buildings will receive federal support to help make it happen.”

John Kerry on John Baird, Keystone XL and hockey

By Luiza Ch. Savage - Friday, February 8, 2013 at 4:12 PM - 0 Comments

Secretary of State John Kerry, right, speaks with Canadian Foreign Minister John Baird at the State Department in Washington. (J. Scott Applewhite/AP Photo)

The newly minted Secretary of State, John Kerry, met with foreign affairs minister John Baird today. They held a joint press conference at the State Department in Washington, Here are a few highlights:

Kerry on Baird:

“He was one of the first calls that I made after I officially came into the building and started and was sworn in, and he is my first guest as foreign minister.”

Kerry on their discussion:

“We dove right into the toughest issues… we began with hockey. I grew up playing a little big, and since I’m a Bruins fan, we clashed in many ways. But he, from Ottawa, is a fan of the Senators. And I want you to know it’s the first time I’ve ever heard someone talk well of senators, so – I’m grateful for it.”

Kerry on his relations with Canada:

“Today was the first of what I know will be many very productive sessions. And the reason for that is that Canada and the United States share the same values. We have a history and a heritage of our people that is unbelievably connected. We have the same entrepreneurial spirit. We have the same core beliefs that everybody ought to be able to find their place in life to do better.”

Kerry on Canadian energy:

“Canada is the largest foreign energy supplier for the United States of America. And many people in America are not aware of that. They always think of the Mideast or some other part of the world. But Canada is our largest energy supplier, and our shared networks of electrical grids keep energy flowing both ways across the border. As we move forward to meet the needs of a secure, clean energy future on this shared continent, we are going to continue to build on our foundation of co-operation.”

Kerry on trade with Canada:

“We also share something else that’s pretty important: a trillion dollars of bilateral trade relationship, and that is hugely important to both of our countries, to our economies and to our citizens. Canada’s one of the largest, most comprehensive investment relationships that we have in the world. It supports millions of jobs here in the United States. And today the foreign minister and I agreed to try to discuss ways that we can grow that and even make it stronger, and there are ways to do that. Our border with Canada, happily, is not a barrier. It’s really a 5,000-mile-long connection between us.”

Kerry on their conversations regarding violence in Syria:

“The foreign minister and I talked about this at length, at length. We both share a deep concern about what is happen there. I am going to focus on it quite considerably.

Kerry, on being asked by a Canadian reporter to speak un peu de français:

“Not today. I’ve got to refresh myself on that.”

Kerry, on whether Obama’s emphasis on climate change in his inaugural address bodes badly for approval of the Keystone XL pipeline:

“With respect to the Keystone, Secretary Clinton has put in place a very open and transparent process which I am committed to seeing through. I can guarantee you that it will be fair, transparent, and accountable.”

Kerry on when a decision will be made:

“I hope we will be able to be in a position to make an announcement in the near term. I don’t want to pin down exactly when, but I assure you, in the near term. I’m not going to go into the merits of it here today. I pay great respect to the important of the energy relationship with Canada, and the importance of the overall relationship. We have a legitimate process that is underway and I intend to honor that.”

Baird on Keystone XL:

“We had a good discussion with regard to Keystone. We appreciate the secretary’s comments at his confirmation hearings.
We spoke about making a decision based on science and based on facts. Obviously when it comes to the environment, I think we have like-minded objectives. Prime Minister Harper and President Obama have both set a 17% reduction in GHG emissions. We have worked well together on reducing vehicle emissions for cars and light trucks. Canada is aggressively moving forward on our plan to ban and phase out dirty coal-fired electricity generation. And we’ll continue to focus on that. We all share the need for a growing economy to create jobs, we share the desire on energy security in North America, and we also share the objective of protecting the environment for future generations. Those will be areas where we will continue to work together.”

Oil sands bust

By Chris Sorensen - Tuesday, February 5, 2013 at 7:00 PM - 0 Comments

Etienne de Malglaive/REA/Redux

Prime Minister Stephen Harper first dubbed Canada an “emerging energy superpower” back in 2006. He was talking, primarily, about Alberta’s oil sands. “We are a stable, reliable producer in a volatile, unpredictable world,” he said, sending a clear signal that Ottawa intended to realize the oil sands’ full economic potential, as well as the geopolitical clout that comes along with it.

It was music to Albertans’ ears. With the world’s third-largest proven crude oil reserves, some 175 billion barrels, behind Saudi Arabia and Venezuela, the province had long been aware it was sitting on a gold mine. All that was needed were global oil prices above US$80 a barrel (needed to offset the expense of separating gooey bitumen from the sandy soil) and the necessary political vision to make it all happen. Canada finally had both. Industry forecasts predicted that, over the next quarter-century, the oil sands would draw more than $364 billion in investment, create some 3.2 million “person-years” of employment and add $1.7 trillion to Canada’s GDP. Continue…

Nature journal urges approval for Keystone, says oilsands not that dirty

By The Canadian Press - Thursday, January 31, 2013 at 3:53 PM - 0 Comments

WASHINGTON – A prestigious science journal has gone to bat for TransCanada’s Keystone XL pipeline, urging the White House to greenlight the controversial project and arguing that Alberta’s oilsands aren’t as “dirty” as some contend.

“The administration should face down critics of the project, ensure that environmental standards are met and then approve it,” Nature said in an editorial this week.

The editorial, entitled “Change For Good,” argued that the pipeline won’t determine whether the oilsands are developed.

“Nor is oil produced from the Canadian tarsands as dirty from a climate perspective as many believe (some of the oil produced in California, without attention from environmentalists, is worse),” the editorial reads.

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John Baird’s six most pressing international files

By Michael Petrou - Sunday, January 27, 2013 at 9:46 PM - 0 Comments

John Baird’s priorities for 2013 will focus on trade. Security issues, however, may force themselves to a more prominent place on this government’s agenda. Here are Baird’s most pressing international files:

The Keystone XL pipeline:

U.S. approval of the pipeline, designed to carry Canadian crude oil to U.S. refineries, has been long delayed. U.S. President Barack Obama sent the proposal to the State Department for a revised assessment to avoid dealing with the issue prior to the American election in November. American Environmentalists fiercely oppose the plan, and Obama wanted their votes.

The results of that State Department assessment are expected this spring. Obama’s nomination of John Kerry, seen as an environmental advocate, for secretary of state has raised concerns among Keystone advocates that America might reject the project. Canada is seeking alternative markets for Canadian oil, but America remains its most lucrative customer and Baird will be working hard to close this deal.

A Canada-European Union free trade deal:

The Foreign Affairs website still lists concluding an agreement with the European Union as a priority for 2012 — underlining the slower-than-expected pace of ongoing negotiations. Reports say a deal is imminent, but we’ve been hearing that for a while.

A Canada-India free trade deal:

Canada’s negotiations with India began in 2010. Canadian Prime Minster Stephen Harper and Indian Prime Minister Manmohan Singh re-affirmed their desire to close the deal by the end of this year when Harper visited India last fall. A seventh round of talks will be held next month in New Delhi.

Mali:

Just because a country doesn’t plan for a war doesn’t mean it won’t be involved in one. An unexpected advance by Islamist rebels in northern Mali toward the capital, Bamako, earlier this month prompted France to deploy troops at the request of Mali’s fragile, post-coup government. France and Mali’s poorly trained soldiers are now actively fighting Islamsits from al-Qaeda’s North Africa franchise, along with affiliated groups. Canada has committed one C-17 transport plane to ferry gear from France to Mali. Harper suggests Canada’s contribution may expand, but he wants “broad consensus” in Parliament. Mali will be debated during the first week the House returns.

Afghanistan:

Afghanistan has faded from the headlines with the end of Canada’s combat mission there, but it remains this country’s largest overseas military commitment, with some 925 Canadian soldiers and 45 civilian police deployed as part of a NATO mission to train Afghan soldiers and police. Foreign Affairs’ Stabilization and Reconstruction Task Force will spend about $25 million a year there until 2014, when the military mission is due to end.

Barring any Canadian casualties — especially from insider “green on blue” attacks by Afghan security forces that killed 60 foreign troops in 2012 — this file may be a quiet one in 2013. Next year, when Canadians will be forced to pay attention to the sort of country we’re leaving behind, it will heat up.

Iran: Baird calls Iran the biggest threat to international peace and security in the world. In an interview with Maclean’s, he voiced his support for President Obama’s position that military force may be necessary to prevent Iran from obtaining nuclear weapons. If Israel or the United States strikes Iran this year, world opinion will be polarized. Canada may find itself among the few nations supporting such an attack, and it will be up to Baird to explain why.

Iran

Baird calls Iran the biggest threat to international peace and security in the world. In an interview with Maclean’s, he voiced his support for President Obama’s position that military force may be necessary to prevent Iran from obtaining nuclear weapons. If Israel or the United States strikes Iran this year, world opinion will be polarized. Canada may find itself among the few nations supporting such an attack, and it will be up to Baird to explain why.

Keystone XL’s fate now squarely in the hands of U.S. State Department

By The Canadian Press - Tuesday, January 22, 2013 at 8:05 PM - 0 Comments

The fate of TransCanada’s controversial Keystone XL pipeline now rests with the U.S. State Department after Nebraska’s governor gave his blessing to a new, less environmentally damaging route through his state.

Dave Heineman sent a letter to President Barack Obama on Tuesday confirming he would allow the oil pipeline to go through Nebraska along a revised path that skirts ecologically sensitive areas.

Because Keystone XL would cross an international border, it requires approval from the U.S. State Department and Obama.

“We did receive a letter from the governor of Nebraska approving the route through the state of Nebraska. We will obviously take that letter and the Nebraska environmental report into consideration as we continue our federal review process,” said State Department spokeswoman Victoria Nuland.

Continue…

Alberta pleased with Nebraska OK on pipeline, but notes Obama has final say

By The Canadian Press - Tuesday, January 22, 2013 at 4:17 PM - 0 Comments

EDMONTON – Alberta’s energy minister says he is pleased to hear that a major hurdle has been cleared on the Keystone XL pipeline.

But Ken Hughes says Keystone, which will ship oilsands bitumen to refineries on the U.S. Gulf Coast, is just one part of the puzzle.

Hughes says the province still needs pipelines to eastern Canada and to the west coast to ship oil to booming markets in Asia.

He made the comments after Nebraska Gov. Dave Heineman sent a letter to U.S. President Barack Obama saying he would allow the pipeline to go through his state.

Critics in Nebraska have said the line threatens an ecologically sensitive aquifer, but Heineman told Obama he is content with a revised route that avoids the area.

Alberta Premier Alison Redford, who has been pushing for the Keystone line, says in a news release that she, too, is pleased with the latest development, but says the final decision rests with Obama.

US state governor notifies officials he approved new Canadian pipeline route through Nebraska

By Grant Schulte, The Associated Press - Tuesday, January 22, 2013 at 1:00 PM - 0 Comments

LINCOLN, Neb. – Nebraska Gov. Dave Heineman approved a new route for the Keystone XL oil pipeline on Tuesday that avoids the state’s environmentally sensitive Sandhills region.

Heineman sent a letter to President Barack Obama confirming that he would allow the controversial, Canada-to-Texas pipeline to proceed through his state.

The project has faced some of its strongest resistance in Nebraska from a coalition of landowners and environmental groups who say it would contaminate the Ogallala aquifer, a massive groundwater supply.

Canadian pipeline developer TransCanada and some workers’ unions say the project is safe and will create thousands of jobs.

The original route would have run the pipeline through a region of erodible, grass-covered sand dunes. The new route skirts that area, although the pipeline’s most vocal critics remain firmly opposed to it as well.

“Governor Heineman just performed one of the biggest flip-flops that we’ve in Nebraska political history,” said Jane Kleeb, executive director of the group Bold Nebraska.

Heineman said previously that he would oppose any pipeline route through the Sandhills region. In his letter to Obama, he said the new 195-mile (320-kilometre) route through Nebraska avoids the Sandhills but would still cross part of the aquifer. Heineman said any spills would be localized, and the clean-up responsibilities would fall to TransCanada.

The governor said the project would result in $418.1 million in economic benefits for the state and $16.5 million in taxes from the pipeline construction materials.

Forget the Keystone XL. It doesn’t matter (all that much) anymore.

By Erica Alini - Wednesday, December 5, 2012 at 6:04 PM - 0 Comments

Jimmy Jeong/Bloomberg/Getty Images

It was supposed to be a lifeline for Canada’s choking oil sands and America’s path to energy independence from the Middle East, Venezuela and the rest of the world’s rogue or unstable hydrocarbon exporters. It saw the Harper government lash out against “eco-extremists,” who, like other types of terrorists, we were told, are well connected to shady foreign financiers. In the U.S. it split “the Democrats’ twin pillars of big labor and environmentalists,” as the Washington Post put it at the time.That was the Keystone XL pipeline in 2011.

Just over a year later, though, it looks… well, not irrelevant, certainly much less important. “Even if the current Obama administration gives its final assent to the Keystone XL pipeline this will not resolve Canada’s export challenge,” notes a new CIBC report that came out yesterday. And it’s not just because we should really stop depending on a single buyer of our most prized export and diversify by catering to oil-thirsty Asian countries. It’s also because “US energy production is increasing at a pace that few, if any, saw coming,” reads a foreword penned by none other than Jim Prentice.

One of the few who did see it coming is Philip Verleger, a former advisor to President Ford and once director of the Office of Energy Policy at the U.S. Treasury under Carter. He thinks the lower energy prices brought on by the shift to shale will spur a productivity boom in the U.S. akin to what happened when computers started making their way into America’s workplaces. He  has also repeatedly said—for example, here—that Canada, for now, is the only country other than the U.S. with the ability to produce shale gas competitively. Trouble is, according to this study by TD Economics, that Canadian businesses and consumers don’t have much use for cheap natural gas since, unlike Americans, they already enjoy relatively low power rates. Here too, concludes TD, the key is turning to Asia: Canada would need to export to countries like China and India to find a market for its vast reserves of shale.

In all likelihood, the next furious pipeline battles will about tubes that get stuff to the Pacific, not the Gulf of Mexico.

Obama’s decision on U.S.-Canada oil pipeline may preview new term’s energy, climate approach

By The Associated Press - Saturday, December 1, 2012 at 12:02 PM - 0 Comments

WASHINGTON – It’s a decision President Barack Obama put off during the 2012 campaign, but now that he’s won a second term, his next move on a proposed oil pipeline between the U.S. and Canada may signal how he will deal with climate and energy issues in the four years ahead.

Obama is facing increasing pressure to determine the fate of the $7 billion Keystone XL project, with environmental activists and oil producers each holding out hope that the president, freed from the political constraints of re-election, will side with them on this and countless other related issues down the road.

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Keystone XL pipeline back in the U.S. spotlight following Obama’s re-election

By Lee-Anne Goodman - Thursday, November 15, 2012 at 5:54 AM - 0 Comments

Fernando Salazar/Wichita Eagle/Getty Images

WASHINGTON – The re-election of President Barack Obama has put TransCanada’s Keystone XL pipeline back on the radar in the United States, particularly now that climate change is once again a hot topic of discussion in the aftermath of mega-storm Sandy.

The oil industry is optimistic that Obama will now approve the US$7 billion project he stalled in January, deferring a decision until after the presidential election.

Environmental groups, meantime, say they expect thousands to show up in downtown D.C. on Sunday for a march to the White House in a resumption of their high-profile battle against Keystone XL.

There wasn’t much reason for them to cheer on Wednesday when Obama took to the podium in the White House for the first news conference since he was re-elected last week.

While the president said America has an obligation to future generations to address climate change, he acknowledged it’s not a priority and added there’s no consensus on how to tackle it.

“The American people right now have been so focused, and will continue to be focused, on our economy and jobs and growth that, you know, if the message is somehow we’re going to ignore jobs and growth simply to address climate change, I don’t think anybody’s going to go for that,” he said.

“I won’t go for that.”

He didn’t comment specifically on Keystone during his remarks in the East Room.

TransCanada officials, meantime, expressed confidence that the pipeline will soon get the green light.

“We continue to believe that Keystone XL will be approved and the outcome of the U.S. election does not change our thinking,” Alex Pourbaix, the company’s president of energy and oil pipelines, told TransCanada’s (TSX:TRP) annual investor conference on Wednesday.

“At the end of the day, it’s very difficult for us to imagine how increased energy security, significant economic stimulus and job creation aren’t in the best interest of the United States. The facts that support the approval of Keystone XL remain the same and the need for this pipeline grows stronger the longer its approval is delayed.”

Obama rejected TransCanada’s application 10 months ago, citing concerns about the risks posed to an environmentally sensitive area in Nebraska by the pipeline’s original route.

The president invited TransCanada to submit another application after rerouting the pipeline around Nebraska’s Sandhills, necessitating another State Department environmental review of the project. The State Department is involved because the pipeline crosses an international border.

After working closely with Nebraska officials to develop a new route, the company submitted another application in May.

Public hearings into the new route are scheduled for next month, and then Nebraska Gov. Dave Heineman will review it. TransCanada, consequently, could know the fate of Keystone XL in just a few months.

Environmentalists, meantime, are pointing to the devastation wrought by superstorm Sandy last month as reason to reject the pipeline once and for all.

Keystone XL would bring 700,000 barrels of carbon-intensive oilsands crude a day from Alberta, through six states and to Gulf Coast refineries.

“Here’s what’s changed since last year: the Arctic has melted disastrously,” a group of prominent environmentalists wrote recently on the website of 350.org, one of the organizers of Sunday’s march.

“Here’s what hasn’t changed: Keystone XL is still a crazy idea, a giant straw into the second biggest pool of carbon.”

Al Gore, the former vice-president who’s now a leading climate champion, has called on Obama to seize the moment and use his decisive re-election triumph to take serious action. Approving Keystone, he added, would be lunacy.

“The tar sands are just the dirtiest source of liquid fuel you can imagine,” he said in an interview this week with Britain’s The Guardian newspaper.

“At a time when we are desperately trying to bend the emissions curve downwards, it is quite literally insane to open up a whole new source that is much more carbon-intensive.”

He also urged Obama to push for a carbon tax in negotiations with congressional Republicans over a looming budget crisis dubbed the “fiscal cliff.”

“President Obama does have a mandate, should he choose to use it, to act boldly to solve the climate crisis, to begin solving it,” Gore said.

Some conservative think tanks have recently raised the possibility of such a carbon tax, but Obama suggested there was little appetite for it during his White House news conference.

When asked if there’s an absence of consensus on taxing emissions from fossil fuels, he replied: “That I am pretty certain of.”

Climate change was barely mentioned during the recent presidential campaign until Sandy roared ashore in late October.

New York Mayor Michael Bloomberg, a former Republican who’s now an independent, subsequently endorsed Obama for president because he said he trusted him to tackle climate change. Bloomberg had said previously he had no plans to endorse either Obama or Mitt Romney, the president’s Republican rival for the White House.

Americans too have come around on climate change, perhaps influenced by the summer’s near-calamitous drought in the West and record-breaking temperatures throughout much of the United States.

The Pew Research Center found recently that two-thirds of Americans believe climate change is real.

Bill McKibben, a leading American environmentalist, says Keystone offers Obama the ultimate opportunity to prove to Americans he’s serious about climate change.

“It will be painfully easy to tell if President Barack Obama is going to take a serious stab at doing something about climate change in his second term: the purest, starkest test he faces will be the proposed Keystone XL pipeline from the tar sands of Canada to the Gulf of Mexico,” he wrote earlier this week.

TransCanada, meantime, urged opponents of the pipeline to consider the alternative.

“To move the kind of crude volumes that Keystone XL will transport, it would take a constant line of tanker trucks — 4,000 trucks a day loading up and moving out every 20 seconds, 24 hours a day, seven days a week,” Pourbaix said.

More than 1,000 standard tank rail cars would be needed to move the same amount of oil, he added.

“Both of these shipping methods have much higher risks than pipelines,” he said. “Railways have roughly 25 times more accidents than pipelines and trucks have 3,000 more accidents.”

Moody’s Investor Service predicted this week that the White House will, indeed, reverse course and green-light Keystone XL while acknowledging the approval process could drag on.

“Still, even if Keystone XL went into operation in 2015 or 2016, Gulf Coast refining and marketing companies would benefit from wider light/heavy crude price differentials,” Stuart Miller, Moody’s vice president, said in a report published earlier this week.

Pipeline economics: China needs oil, and Canada’s got it

By Colby Cosh - Tuesday, September 25, 2012 at 11:34 AM - 0 Comments

Jianan Yu/Reuters

The UC Berkeley economist Brad DeLong has said that Deng Xiaoping may have been “quite possibly the greatest human hero of the 20th century.” It’s a tough-minded, utilitarian judgment; DeLong knows that Deng, as leader of China, ordered the Tiananmen massacre of 1989. In the other pan of the balance, however, is the successful transformation of China into a free-market industrial power. That transformation, over three decades of Deng’s leadership, multiplied per-capita GDP 50-fold and lifted somewhere between 200 million and 400 million people out of poverty.

The revolution is still ongoing, and it runs on oil. Enter Canada. Hearings into Enbridge’s proposed Northern Gateway pipeline, which would link the town of Bruderheim, Alta., to the Pacific Rim at Kitimat, B.C., are being held now in Alberta and will soon shift to British Columbia. The B.C. phase of the hearings will see Enbridge challenged on whether it can successfully protect B.C. wildlands and the port of Kitimat from environmental disasters like the spill that affected the Kalamazoo River in Michigan in 2010.

But in Edmonton, the topic of discussion has been the basic economic rationale for the pipeline. Put in its simplest form: China needs oil, and Canada’s got it. In truth, however, that pretext could be stood on its head. Canada needs alternative markets for its oil, and China is the obvious one. Right now, the oil sands are more or less forced to take a U.S. Midwest price for their product. With the sudden reflation of U.S. oil reserves, Alberta has been getting an increasingly raw deal. Enbridge consultant Neil Earnest explained to hearing attendees at a Holiday Inn in south Edmonton that it costs about $7 in pipeline tolls to move a barrel of Western Canada Select crude to the Gulf of Mexico. “But the price [of WCS] today at Edmonton is not the Gulf Coast price minus $7,” he explained. Owing to the huge oversupply of crude in the U.S., “it’s the Gulf Coast price minus $30.”

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Bitumen and/or bust

By Aaron Wherry - Monday, August 20, 2012 at 10:00 AM - 0 Comments

Esquire dispatches John Richardson to report on Fort McMurray, the oil sands and the Keystone XL pipeline.

So what does the damn stuff look like? I’ll show you, Tom says. In a long rectangular building with lots of tubes, he opens a faucet at a station and fills a paper cup with pure bitumen. Thick as melted chocolate, it smells like tar. ”That’s our product,” he says. To the touch, it’s lighter than it looks. Mix it with liquid natural gas and it flows. This is what goes into the pipeline under the name “dilbit,” short for diluted bitumen. ”That’s what it looks like,” he says. “That’s what all the fuss is about.”

Awe seems the appropriate response. This greasy black gunk with the protean powers of money itself, able to metamorphose into everything from my iPhone to the fancy petroleum-based REI jacket I am wearing, a staggering combination of chemistry and human ingenuity. And yet, according to one credible and centrist study, if Canada caps the oil sands at 1.6 million barrels a day, the world has only a 50 percent chance of keeping CO₂ in the atmosphere below 450 parts per million — the target most scientists think will keep the earth from warming more than a few degrees in this century. Current approved flow is already 1.6 million barrels a day. Projects in construction bump that to 2.3 million. Projects announced or in application send it to more than 5 million barrels a day. So the bottom line is: If the production of oil sands keeps on growing at the rate it is now growing, the temperature of the world could go up 11 degrees by the end of the century. You look down at the cup, a sludge the color of hot chocolate. Is this the way the world ends?

Northern Gateway in the pages of the Rolling Stone

By Aaron Wherry - Friday, August 3, 2012 at 11:15 AM - 0 Comments

Rolling Stone takes note of the pipeline debate in Canada.

Harper also went after those who oppose the pipeline. Days before Obama’s decision on Keystone, Harper’s minister for natural resources was denouncing “environmental and other radical groups” who “hijack” regulatory bodies and “use funding from foreign special interest groups to undermine Canada’s national economic interest.” Just to make sure environmentalists got the message, Harper issued a budget that gutted protections for endangered species and pushed through new laws requiring nonprofit groups to “provide more information on their political activities, including the extent to which these are funded by foreign sources.”

In reality, it’s not environmental groups that are funded by foreigners – it’s the companies eager to exploit the tar sands. Many of Canada’s biggest energy companies – firms that are headquartered in Canada and trade on Canadian stock exchanges – are in fact largely owned by foreign interests, including Suncor (57 percent), Canadian Oil Sands (57 percent) and Husky Energy (91 percent). All told, some 70 percent of all tar-sands production in Alberta is owned by non-Canadian shareholders.

Signals, noise, and eco-disaster at Enbridge

By Colby Cosh - Tuesday, July 17, 2012 at 1:32 AM - 0 Comments

“Learning about Enbridge’s poor handling of the rupture, you can’t help but think of the Keystone Kops,” said Deborah Hersman, chair of the NTSB. “Why didn’t they recognize what was happening? What took so long?” she said in a statement. She said that despite alarms and pressure differentials, Enbridge staff twice pumped more oil, about 81 per cent of the total release, into the ruptured pipeline. Hersman said that oil gushed from the rupture for more than 17 hours before the leak was discovered.

This is a fair bottom line when it comes to Enbridge’s Line 6B leak, which poured about a million gallons of diluted bitumen into a tributary of the Kalamazoo River on July 26, 2010. As an Albertan, with all the prejudices and interests that implies, I’ve been reading primary documents in the U.S. National Transportation Safety Board’s investigation of the spill. What I slowly came to understand, to my considerable horror, is that the leak may physically have happened to a bunch of poor bastards in Michigan, but the real problem was here, in Edmonton. This is where pipeline controllers—tired, young, inexperienced pipeline controllers working in a somewhat dysfunctional environment—struggled for long hours to interpret pressure readings as anything but the unthinkable. Continue…

The southern view of Keystone XL

By Aaron Wherry - Wednesday, July 11, 2012 at 6:00 PM - 0 Comments

The Washington Post has dispatched a team to travel the proposed route of the Keystone XL pipeline. The team’s blog is here. And their first stories from Alberta are here.

The pipeline has become a powerful symbol and political pawn this election year. It is also a sort of Rorschach test of how Americans view energy issues: Are we energy rich or energy poor? How do energy policies affect job creation, tax revenue and U.S. manufacturing competitiveness? How pressing are ­climate-change concerns, and how do we balance them with economic priorities?

The American public is firmly behind the pipeline, seeing plenty of upside in potential jobs and limited environmental downside. A new Washington Post poll finds nearly six in 10 saying the U.S. government should approve the project. Its wide acceptance is rooted in the fact that 83 percent think it will create jobs. Nearly half think it will not cause significant damage to the environment.

The oil industry and many national security experts think that importing more oil from Canada, a stable neighbor and ally, will make the United States more secure, and they worry that, without the Keystone XL, Canada will send that oil to China. But the process of extracting oil from the sands, also called tar sands, has alarmed people worried about climate change.

Presumably the Post team will eventually visit the towns of Reklaw (pop. 379), Alto (pop. 1,225) and Gallatin (pop. 419), Texas, which are fighting the pipeline because they fear a spill could contaminate their water supply.

See previously: Keystone rhetoric and reality