TransCanada Corp.’s Keystone XL saga continues

Why corporate railing won't erase opposition to the oil sands

August 01, 2011

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Things are not getting any better for TransCanada Corp. and its proposed Keystone XL pipeline. It’s a sad story all around. The folks at the Calgary-based pipeline company probably don’t deserve all of the abuse they are taking as a result of proposing this project, which would transport crude from Alberta’s oil sands to refineries on the United States Gulf Coast. But abuse is what the company is getting – from landowners, individual environmentalists, members of U.S. Congress, the U.S. Environmental Protection Agency, the Natural Resources Defense Council and others.

The project itself seemed simple enough. Produce a bunch more bitumen from the oil sands and ship it to the Americans. Well, maybe it was necessary to ship it to the U.S. for processing because Alberta had missed the boat on the value-added thing, but still, production is good and the royalties will flow and what’s not to like about more jobs for people from the East Coast? Some observers might question why the province would support the production of more and more bitumen in the absence of a certain way to ship it to markets. But, memories are short – the natural gas bubbles of the late 1980s long forgotten – and both TransCanada and Enbridge Inc. had promised new pipelines.

But promises, as we learn at too young an age, are often meant to be broken. That seems to be the case with both Enbridge’s Northern Gateway project and TransCanada’s Keystone XL. The promised routes to market aren’t quite as easy to realize as first thought. Enbridge somehow forgot about the strength of aboriginal opposition to its pipe and TransCanada misjudged the strength of just about everybody’s opposition to the Keystone XL.

And that raises a very big question. If the development of our resources is so important to our country, if this development provides jobs and business income and revenues to all levels of government, if we as a country are so dependent on our oil and gas to drive the economy, how come all the bright lights in Calgary, Edmonton and Ottawa couldn’t see what was coming in the way of opposition to the oil sands crude and the pipes designed to transport it to market?

It’s not as if the opposition was hard to spot. In fact, it was on the front page of the New York Times. In the pages of the Economist. In the New Yorker columns of Elizabeth Kolbert. Even in the Wall Street Journal. It was also in the election platforms of the Liberals, the New Democrats and the Green Party. It was everywhere. And yet, apparently not seen or, if seen, this opposition was too quickly discounted as just the usual environmental fluff, soon to be blown away when faced with the realities of American energy needs and the long-standing, friendly, secure supplier relationship we offered them.

But something has changed and the bright lights better get on it really quickly or our problems with Northern Gateway and Keystone XL will only be the beginning. When ultra-conservative Republican presidential candidate Mitt Romney acknowledges climate change is happening and that humans are playing a role in that change, you know the game is pretty much up. When Chicago begins to plant new tree varieties in anticipation of climate change impacts, it’s time to pay attention and realize the debate about climate change is no longer a debate. It is here. And Canada, as a country looking to supply oil, better figure out just what that means to us.

One of those implications can be found in the U.S. opposition to Keystone XL. But the leadership of the Canadian Association of Petroleum Producers doesn’t seem to have fully understood what’s behind the opposition. Instead CAPP is choosing to rail against the Americans for trying to regulate our greenhouse gas emissions, a role CAPP feels the U.S. has no business playing.

But the Americans believe they can act against our oil sands development precisely because they think their climate is being affected by that development and that they are suffering as a result. And that view might just be the game-changer that had not been expected by the oil sands sector. Countries have always maintained some environmental oversight over what occurs within their borders. However, what we’re beginning to see now – noticeably in response to greenhouse gas emissions – is a major change in this approach.

While the impact still occurs within a country’s boundaries, the cause happens in foreign lands who continue to emit climate-changing emissions to the detriment of the receiving country. How long will that situation be allowed to last? Apparently, not very long at all. We have already seen legal challenges to this situation, with some eastern U.S. states and Canadian provinces seeking to sue over airborne emissions from coal-fired electricity plants in neighboring states.

It’s worth noting Canada has been no slouch when it comes to taking action against pollution originating from beyond its borders. A couple of years back, the National Energy Board (NEB) refused to permit an electricity transmission line from Washington state to the Lower Mainland of British Columbia because the air emissions from the proposed coal-fired power plant transporting electricity on that line would harm the Fraser River watershed air. The NEB had no jurisdiction over the plant; it would have been located in the U.S. But it killed the power line and so, no plant. So enough of the corporate railing against our opponents. We need to be seen as part of the solution to their problem. And in order to do so, we really do need to understand what they see as the problem.

Doug Matthews spent 25 years working on energy issues for the Northwest Territories government. He now lives in Calgary and, along with his ongoing consultancy work in the North, spends much of his time writing about energy issues.

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One Response to “TransCanada Corp.’s Keystone XL saga continues”

  1. rick says:

    After reading this story, I felt disappointed , not seeing a future of jobs for Alberta ,other countries,and higher gas prices etc.

    I Recall, back in early 2000 cost of living was cheaper . Alberta was struggling to find manpower. This resulted in a vast supply of people moving to Alberta from all parts of Canada. A lot of good tradesmen came. We had a slow period, Kyoto Accord, (2002-2003), which hit us hard in the wallet, but we got through it.

    Now, we’re faced with another wall. The ability to move oil to other markets that require it . (Asia). Why wouldn’t this pipeline be built? People need to work,this project would create so many jobs, around the world at that.

    I feel the reason the economic times were facing, has a lot to do with people not working. I feel people would start buying whatever (cars,electronics,etc) IF they had a job.

    By not building these pipeline projects, required, by the world, we’re going to have no future for the energy that Canada has. I feel if the energy was more available, gas prices would come down. And that is a good thing for economic recovery.