TransCanada/White House Standoff Begins Ahead of Climate Change Summit

Posted by Ed Burke on Nov 4, 2015 1:24:28 PM

Picture of an oil pipeline in the snow

In a surprise move Monday, TransCanada issued a request to the U.S. State Department that they pause the ongoing review of the project until the legal challenges in Nebraska are settled. (Interestingly and somewhat ironically, this is the exact same reason Secretary of State John Kerry gave for why the review was taking so long when asked last year.)

The project that we’ve all been debating for the past several years was looking at a likely rejection from the State Department and the prevailing theory is that TransCanada would like the review process to linger on, in the hopes that the proposal lands in front of a more friendly Administration in 2016, after the Presidential Elections.

The White House put forth this same theory, that the petition was a play to get a more friendly administration to rule on the project and spokesman Josh Earnest said the White House will summarily dismiss the petition for that reason.

TransCanada denies there is any politics at play. Even if it were political, however, the political moves are certainly not one-sided.

The reason cited for the timing of the petition is because Obama is expected to veto the project ahead of the upcoming UN Summit in Paris on Climate change, in order to make a statement on the U.S.’ commitment to battling Climate Change.  Not an apolitical move in and of itself, no?  (In fairness, it has become pretty clear that the President intended to veto no matter what the timing was.)

The Keystone projects’ prominence in the political realm had substantially faded in the face of tumbling oil prices but the issue has come up again with the beginning of the election cycle, with Presidential Candidates on both sides being asked their positions on the project in interviews and debates. The bid from TransCanada this week only added fuel to that fire. 

Whether the move was political, or simply meant to re-raise the issue, it most certainly puts pressure on the Administration to make a decision. That can’t be exciting for the President.  One would think he would rather pass it on to the next person anyway and avoid both the gains and fallouts politically from making the decision.

It will be interesting to see if the veto comes down before Paris, or if the project trudges on longer and longer despite a refusal to pause. 

 

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Topics: Keystone XL, TransCanada, climate change, obama

Keystone XL Hits the Senate Floor

Posted by Ed Burke on Nov 18, 2014 11:59:17 AM

Oil pipeline in the snow

Today, the bill to approve the construction of the the Keystone XL pipeline hits the Senate, after the House approved Cassidy's legislation by 252-161 on Friday. 

In an exciting twist, the Senate is apparently stuck at 59 votes in favor, one shy of the 60 needed to pass the legislation and send it to the Presidents desk. However, Mary Landrieu (D-LA) claimed yesterday to have secured the 60th vote. The bill hits the floor in what some say is an attempt to boost Landrieu's chances of maintaining her Senate seat in the December 6th runoff election she faces versus, oddly, the bill's sponsor, Bill Cassidy.

(Sounds cynical, yes, but given that the House has previously passed 8 seperate bills to push the vote on Keystone and none saw the Senate floor, it seems pretty reasonable as well.)

The jury is out on whether if the bill passes it will be vetoed by the President or not. He cited a legal challenge to the pipeline in Nebraska that is still ongoing, stating that "process should not be interfered with", but Secretary of State John Kerry recently made statements in Canada that implied the Administration may not veto a bill if it came down to it. It's really anyone's guess. 

Obviously, this has been a lighting rod political issue for the over 6 years the project has been on hold. On one side there are environmental groups and people in the geography impacted, who are concerned with  the climate impact, potential leaks,  and the "doubling down" on a commitment to fossil fuels they see the pipeline as representing. On the other are groups who argue this strengthens our energy independence and supports American workers and the American economy versus that of other countries, and those who cite the immediate jobs boost the project will represent. 

We've talked about some of these Keystone related issues before: 

There are 6 hours scheduled for debate on the floor, with the vote expected to occur at 6:15pm. Stay tuned! 

 

 

 

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Topics: Energy Independence, Keystone XL, Energy Infrastructure, TransCanada, senate

Pipeline Stubbornness - Canada's "Work Around" & US Environmental Harm

Posted by Ed Burke on Oct 17, 2014 12:00:00 PM

Protestors holding a sign that reads, Stop Keystone Climate Change

In response to the perpetual Keystone XL pipeline approval delays by the US government, Canada is closing in on a deal to make the final Keystone connection "irrelevant", in the words of former US ambassador from Canada McKenna. 

How? By going East. 

The proposed route would take Bakken shale oil from Alberta to Quebec, and then onto the Irving refinery in St John. The route would utilize an existing, underused nat gas pipeline, with some additions and modifications. The deal would reportedly be a 50-50 venture between TransCanada and Irving Oil.

The port in St John puts Canada in the position of being able to easily and efficiently ship oil to India, or Europe, versus being forced to transport huge quantities (160K barrels per day) by rail instead of pipeline into the US.

An irony of the Keystone delays, as well as pipeline opposition in general, is that it's pretty easy to argue that pipeline transport is more environmentally friendly than railcar or any other means of transport. 

In 2013, 1 million barrels of oil per DAY were transported by railcar, while that number is expected to jump to 1.5 million this year. 

Why? Because Shale is booming and we have no pipeline. And because environmental groups and prominent financiers (ala Tom Steyer, who pledged $50 million dollars to support candidates that oppose the Keystone pipeline) argue that pipelines, especially the Keystone, are environmentally bad news. But is that true? And more importantly - is the alternative to pipeline transport even worse?

It would appear that yes, the alternative may be worse. A Congressional report from a few months ago stated that more oil spilled in 2013 due to railcar accidents than had in the past 35 years. Seems crazy, since stricter safety and environmental standards have been imposed over that 35 year time period in transportation and every other industry. 

Speaking of safety regulations - upcoming costly new regulations on retrofitting railcars are on the horizon. These proposed regulations came up after several high profile railcar explosions (notably Lac-Megantic, which destroyed half a town and killed almost 50 people)

The costs of these retrofits are potentially crippling. The Wall Street Journal reports that thousands of railcars are being scrapped - but it will be tough for the industry to supply new, conforming railcars quickly enough to keep oil transportation costs down. 

(As an aside, these railcar regulations will also impact ethanol transport. A recent Federal Investigation found that ethanol rail transport was equally or more dangerous than crude rail transport. In fact - when exposed to prolonged fire, ethanol railcars were found to be 150% more likely to explode. Yikes.)

So if continual delay on Keystone is having an environmental impact, and new regulations for the alternative-to-pipeline transport method could drive costs up... what exactly is everyone still arguing about?  

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Topics: Keystone XL, TransCanada, shale, railcar regulations, irving oil, environment

Progress on Keystone XL? ....Don't Get Your Hopes Up

Posted by Ed Burke on Jun 25, 2014 2:49:09 PM

Oil pipline in the snow

 

Tuesday the House passed bipartisan legislation to speed up the approval process for cross-border energy projects (ie Keystone XL), despite a promised veto from President Obama.  The bill is known as the “North American Energy Infrastructure Act”, featuring 12 Republican and 8 Democratic co-sponsors. If it passed the Senate, it would establish by law that projects be granted or denied approval within 120 days of the Environmental Impact Study, and more significantly, it would remove the need for Presidential Approval.

Technically the bill doesn’t apply to Keystone XL, because the applications and environmental impact studies are already completed for that proposed project. However, that’s obviously the most glaring example of the need to speed up the process, and probably the impetus for the bill’s submission in the first place. In theory, TransCanada could resubmit their application and be subject to the speedier process. (A motion to prevent TransCanada from resubmitting should the bill pass was handily shut down by a wide margin.) 

It’s unlikely that the bill will get through the Senate with a veto-proof majority, though. It may not even be likely that the bill be considered by the Senate, as Majority Leader Reid has indicated he has no inclination to move this or previous Keystone related bills to the floor if he can help it. 

As you know, the project has been languishing for over 5 years after delay upon delay. Earlier this year, progress looked promising when the Environmental Impact Study found no significant environmental concern to prevent the project from going forward (actually, its more environmentally safe to transport via pipeline than railcar - but I digress...). However, nothing much happened and now the current hold up is purportedly related to a "wait and see" on how a Nebraska district court rules on the proposed pathway for a portion of pipeline in that state.

Frustrating to be sure - but the strong bipartisan nature of the push to move Keystone forward in Congress is an encouraging sign. I'm sure we won't see any real movement until after the midterms, given the polarity of the issue in some areas and the amount of seats up for grabs in the Senate. Hopefully, no matter which way the chips fall in the mid terms, we finally see some real, meaningful progress on what is such an extremely important project for our Energy and National Security. 

 

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Topics: Energy Independence, Keystone XL, Energy Infrastructure, Congress, TransCanada, Environmental Impact Study

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