Keystone rejected

by Aaron Wherry

(This post last updated at 6:57pm.)

So reports the Washington Post. With an asterisk.

The Obama administration will announce this afternoon it is rejecting a Canadian firm’s application for a permit to build and operate a massive oil pipeline across the U.S.-Canada border, according to sources who have been briefed on the matter. However the administration will allow TransCanada to reapply after it develops an alternate route through the sensitive habitat of Nebraska’s Sandhills.

The Prime Minister’s last comments on Keystone came Monday in his interview with the CBC.

I think what’s happened around the Keystone is a wakeup call, the degree to which we are dependent or possibly held hostage to decisions in the United States, and especially decisions that may be made for very bad political reasons. So I think that just … it puts an emphasis on the fact that we must perform our regulatory processes to get timely decisions on diversification of our markets.

Update 2:03pm. Maybe “rejected” is too simplistic a characterization. The New York Times has the project “on hold.”

The administration has until Feb. 21 to decide the fate of the 1,700-mile pipeline to carry heavy crude oil from formations in Alberta, Canada, to refineries on the Gulf Coast. Officials are expected to announce that they cannot meet that deadline and that they are looking for ways to complete a thorough environmental review before making a final decision on the project … The State Department is expected to say that routing, environmental and safety concerns raised by the project are too complex to be decided on that abbreviated timetable and is recommending that President Obama reject it for the time being.

Update 3:17pm. And here is the official statement from the U.S. State Department.

Today, the Department of State recommended to President Obama that the presidential permit for the proposed Keystone XL Pipeline be denied and, that at this time, the TransCanada Keystone XL Pipeline be determined not to serve the national interest. The President concurred with the Department’s recommendation, which was predicated on the fact that the Department does not have sufficient time to obtain the information necessary to assess whether the project, in its current state, is in the national interest.

Update 3:28pm. A note from the Prime Minister’s Office on Mr. Harper’s conversation with Mr. Obama.

Earlier this afternoon, Prime Minister Stephen Harper received a phone call from Barack Obama, President of the United States. President Obama informed the Prime Minister of his Administration’s decision to turn down TransCanada’s application to build and operate the Keystone XL pipeline.

The President explained that the decision was not a decision on the merits of the project and that it was without prejudice, meaning that TransCanada is free to re-apply. Prime Minister Harper expressed his profound disappointment with the news.  He indicated to President Obama that he hoped that this project would continue given the significant contribution it would make to jobs and economic growth both in Canada and the United States of America.

The Prime Minister reiterated to the President that Canada will continue to work to diversify its energy exports.

Update 3:35pm. Althia Raj had early reaction from the NDP’s Megan Leslie. Christopher Sands considers the political calculus. Brad Plumer considers the ramifications.

Update 3:51pm. A fact check from CNN on the number of jobs that would be created by a pipeline.

But TransCanada numbers count each job on a yearly basis. If the pipeline employs 10,000 people working for two years, that’s 20,000 jobs by the company’s count. The estimates also include jobs in Canada, where about a third of the $7 billion pipeline would be constructed. The U.S. State Department, which must green light the project, forecasts just 5,000 direct U.S. jobs over a two year construction period. Even according to TransCanada, the amount of permanent jobs created would be only in the hundreds.

Update 6:57pm. The full statement from Natural Resources Minister Joe Oliver.

“We are obviously disappointed with today’s announcement regarding the Keystone XL pipeline.

This project would create thousands upon thousands of jobs both in the US and Canada and would contribute to energy security in the US. We continue to believe this project is in the best interests of both countries.

Our Government respects the right of the United States to make its own decisions.

However, it is clear that the process is not yet over and we are hopeful that this project will be approved in the future based on its merits.

Canada and the United States enjoy the single most important energy relationship in the world. We will continue to work with the US to further strengthen energy security for both our nations.

Meanwhile, our Government is moving ahead on creating jobs and economic prosperity for all Canadians. The responsible development of the enormous resources provided by our oil sands is expected to create hundreds of thousands of jobs spread across the country, generating significant economic benefits.

We cannot understate the fact that these benefits fund critical services for Canadians, including health care and education. 99% of our oil exports currently flow to the United States. Today’s decision by the Obama Administration underlines the importance of diversifying and expanding our markets, including the growing Asian market, to help ensure the financial security of Canadians and families for decades to come.”




Browse

Keystone rejected

  1. Hands up anyone who didn’t see this coming.

    Well, other than Harper I mean.

    • Don’t be so nasty to our PM.  Did you see it coming?

      • Why not? Harpo is pretty nasty to anyone who doesn’t follow his script. He can dish it out but he’s not so good at taking it.

        • Why do all you libdippers so glory when something goes against your country’s interests?  

          • We’re not ‘libdippers’…..just rational people.

            Repubs put in that 60 day clause, knowing full well an environmental review is required, and there isn’t enough time to do one.

            Obama had no other legal choice.

            Now they’ll try to get him on ‘job loss’   However….

            ‘The Republicans’ claim that the pipeline will create tens of thousands of new jobs — 20,000 according to House Speaker John Boehner and 100,000 according to Jon Huntsman — are wildly inflated. A more accurate forecast from the federal government, one with which TransCanada, the pipeline company, agrees, says the project would create 6,000 to 6,500 temporary construction jobs at best, for two years. ‘

            http://www.nytimes.com/2012/01/02/opinion/where-the-real-jobs-are.html?_r=2

          • I’m not a “libdipper.” I’m with Original Emily. I’m a rational person who can think independently.

            I’m not convinced that the project is in Canada’s long-term interests. Certainly, Steve hasn’t convinced me — his fixation on “foreign interests” raises alarm bells for me. When he paints everyone opposed to his dictates with the same brush (i.e. “radicals”), I just tune him out.

      • Obama said he wouldn’t be pushed into a decision by the Congress.  They tried to do it anyway.  So, no suprise.

  2. I think what’s happened around the Keystone is a wakeup call, the degree to which we are dependent or possibly held hostage to decisions in the United States, and especially decisions that may be made for very bad political reasons.

    Interesting in light of SOPA and our own copyright bill.

  3. Does this mean pipeline cancelled entirely or is this just re-announcement of one year delay until after election? If entirely cancelled, I assume it has to do with US presidential politics because Repubs making a big deal out of Pres Obama’s decision to delay pipeline. Repubs have been setting deadlines to try and force Obama into decision one way or another.

    It would also be nice if Harper pulled his finger out sometime soon and stop behaving like serene bureaucrat. Trade deal with EU is nice but Europe is dying because all the clever people are leaving while listless and dullards remain behind. Economic action is happening in East and South but Harper stalling on trade deals with that part of world because we have to protect a few thousand sainted dairy farmers while other 30 million + Canadians can take long walk off short pier. 

    WSJ ~ Jan 14 2012 ~ Exodus Of Workers From Continent ….

    Economic distress is driving tens of thousands of skilled professionals from Europe, and many are being lured to thriving former European colonies in Latin America and Africa, reversing well-worn migration patterns. Asia and Australia, as well as the U.S. and Canada, are absorbing others leaving the troubled euro zone.

    At the same time, an influx of Third World immigrants whose labor helped fuel Europe’s growth over the past decade is subsiding. Hundreds of thousands of them, including some white-collar professionals, have been returning home.

    • Yup there’s nothing but 300 million dullards and listless folks left in Europe.

  4. I’m a pragmatic enviromentalist. So, i think this is bad news for those of us who don’t want gateway to proceed. I would say this pretty well guarantees this is going to be an ugly protracted fight in BC.
    In an ideal world no export of tar sands product could be hoped for – it isn’t, so this is bad news in the end for enviromentalists. There is a reasonable argument to be made for exporting to the US in the short to medium term while we sort out just how we are going to green our economy, and given the current parlous state of the US economy; our govt and energy sector didn’t stick with just these arguments of course, they had to egg the pudding with ludicrous claims about ethical oil [ ethical oil to the US and unethical oil to the commies???] and radical enviros – what’s next, uppity backwards looking natives who just can’t embrace the new future?Harper’s postioning begins to make more sense. Presumably he had forewarning of this decision [ probably Obama gave him a call a while back?] and decided to double down on gateway.

    If only from  a political pov it made sense to choose the lesser of two evils in letting keystone proceed [ not through the sand hills]  while ramping up the argumemnts for a slower pace of development and more home grown value added stuff.
    Harper’s inference is pretty clear – IRP or not the pipeline will go through. The case for completely stopping it just got weaker, although it wont be through Kitimat. The govt should avoid banging its head against that wall and work on persuading[ as opposed to bullying and bribing] the folks in PR to accept the pipeline. Either way the fight almost certainly just got nastier – which is just where Harper likes to be, so i expect him to change nothing, keep on bulling ahead until even he looks for other options. 

    • Nice assessment, since I agree with it completely.

    • But surely the oil gets sold.  The question is does it get sold on terms even more profitable to the sellers or not? 

      And long term, if it doesn’t get sold, surely that means a big pool of cheap oil for Canadian purchase? 

      • Presumably some oil is getting sold right now through existing pipelines but this doesn’t allow for any growth. Not that i want to see unlimited exponential growth, since i don’t think it’s in our collective[ read global] interests to just keep on doing more of the same old, but  with ever more unsustainable and unacceptable enviromental risks. 

        I don’t know if you are making an argument for slowing down the process and the supply hoping for better prices  –  i’m doubtful the demand side of the equation would support that ?They would simply look for another source, no?  –  and a better enviromental outcome, or arguing for a cheaper made in Canada solution?

         I think we already tried that one with pretty poor outcomes even if it does make sense if you view Canada as one entity rather then a collection of competing fiefdoms. Unfortunately right now it appears to be more the latter. I even think it says something in the original constitution about the fiefdoms having the right to their entittlements however little sense it may make in the overall picture.

        * oops, just reread your first sentence. Yes, that is the point when it comes to gateway,
        when is
        enough profit enough? Does the industry have a vetoe over our collective right to say – “Whoa! Listen up! There are other values to be considered here ya know, beyond profits of the industry and and shareholders.”

    • Made worse by Christy Clark hiring Ken Boessenkool, Harper insider and former lobbyist for Enbridge,  as her chief of staff. 

  5. So Joe Oliver thinks decisions based on concerns over environmental effects are ”made for very bad political reasons”. What fools these Conservatives are. They have no understanding of on-the-ground reality.

    • Apocalyptic warming was last year’s scary movie.  

      • It’s been held over….for a very long run.

  6. Environmentalism is a freeroll:  Greenies get the benefits of an oil based economy while also scoring brownie points for buzzkilling everyone else on the evils of oil.  The rubber is light years from the road.  

    Me, I’m a conservative, I can do the stone age, but these hipsters and granolas and their consumer fetishes wouldn’t last a day.  It’s getting to the point where we should look at legislation making Greenies eat their own dogfood, so to speak, such as restricting Greenies from enjoying the benefits of oil based economy and denying government services to those who would destroy the Canadian welfare state by sabotaging the economy that pays for it all. 

    • Alberta is an oil-based economy….Canada isn’t.

    • So, in typical Con fashion, you berate anybody that disagrees with you. Sorry, but you haven’t convinced me and I’m a non-partisan person who cares about the environment and the future of our country. You’re going to have to do better to convince me that this is nothing more than a strategy to pillage the future of ALL Canadians for a short-term economic benefit to the detriment of future generations. What’s the big rush? That oil won’t evaporate over night.

    • “Me, I’m a conservative, I can do the stone age, but these hipsters and granolas and their consumer fetishes wouldn’t last a day”

      Apart from the fact that these days many cons are as obese and clueless as to how to survive a societal collapse as any itinerant hippy, you seem to be impying cons don’t invest in hipster stuff and granola futures  cuz they’re all too busy doing real mans work like drilling for oil baby. Makes you wonder how this country ever got by before someone discovered black gold on the banks of the Atha B. Back when we were forced to slave in factories making our own fidges, tvs, cars and stuff.

      • I think he’s already doing the stone age. 

    • This is not the way to sell the pipelines.

  7. It will be back. It deserves to be temporarily punished for picking a
    truly stupid route. And for deliberately picking an old Hilary Clinton
    crony to be its’ front person in a State Dept. review. TransCanada
    will have to spend more money than it thought it could get away with
    but so be it.
    The same applies to the Kitimat line. A stupid route. Spend more
    money. Find a route less risky. But the private sector and its’ gummint
    friends are just so much smarter than anyone else… because when they screw
    up they find a way to make the rest of us pay for it.

    • I agree with you that there are other possible routes for Gateway.  I was just discussing this with a former BC government cabinet minister the other day.  The current Gateway route is what it is because it’s by and large the most efficient and cheap way to go, from an engineering/terrain perspective.  But there are definitely alternative routes that are possible.

      It’s a bit reminiscent of what’s happened with the Prosperity Mine.  The original mine plan was what it was because it was the most purely cost-effective way to go.  When that got shot down, they came back with the new plan, which is more expensive but nonetheless economically feasible.

      • Apart from the fact that the guy in charge of the PM has admitted the new proposal will kill the lake in 10 years instead of right away, i think you and BG called it.
        The puzzling thing is why noone seems to be doing a cost benefit analysis of just how much extra time, good will, political capital and of course money all this is costing the country. It’s almost like those who favour development automatically just right off opposition straight off the bat as just part of the cost of doing bisiness, rather then seeking to accomodate differing values, or seek consensus. 
        Why doesn’t the oil industry ask the logging industry in BC what it cost to eventually realize that working with those opposed pays off in the long run? I guess it ‘s hard to fit long run on a spread sheet, or explain it well at a shareholders meeting.   

        • The forest industry is 20 years ahead of the oil industry. 

  8. Is it strange that the Prime Minister use the word “we” when referring to Transcanada? This is yetanother sign that the government is run by the oil companies.

    When New Zealand reject the Canadian Pension Plan from investing $1.4 billion in the Auckland airport did Stephen Harper even comment?

Your email address will not be published. Required fields are marked *