Fair or not, Keystone XL fell victim to politics

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by L. IAN MacDONALD
The Gazette, Wednesday, November 16, 2011

It's unheard of for a sitting president of the United States to give an interview to local television in Nebraska. A candidate for president, that's different. He'll talk to anyone. Meet Barack Obama, who's both.

On the first day of November, Obama gave several interviews from the White House to local TV anchors in Nebraska in which he said he was on the case of the proposed Keystone XL pipeline, and would be making the decision himself about approving it or not.

"We don't want, for example, aquifers adversely affected," Obama said in one interview. "Folks in Nebraska obviously would be directly impacted and so we want to make sure we're taking the long view of these issues."

He also referred to "drinking water that would damage their health or if rich land that is so important to agriculture in Nebraska ends up being adversely affected."

Obama's interview should have been a heads-up to TransCanada and to Ottawa that, far from being a "nobrainer" as Prime Minister Stephen Harper recently called it, the Keystone XL project was in big trouble.

Nine days later, candidate Obama kicked the Keystone down the road past next November's presidential election, as Washington announced a minimum one-year delay and ordered TransCanada to reroute the Keystone XL project around the aquifer that sits on top of most of Nebraska's water supply.

In other words, come back to us after the election, and show us a Plan B - something TransCanada should have had in its back pocket all along.

In doing so, Obama took the pipeline off the table as an election issue, one that his own environmental base had been yelling at him about.

He was also choosing the environment over jobs - about 20,000 shovel-ready jobs in a country that could sure use them. Which is why Keystone was supported by the labour movement, another key Democratic constituency.

The pipe is already sitting on the ground in North Dakota, waiting to be assembled along a 1,700-kilometre route to the Gulf Coast, to which it would move 700,000 barrels a day from the Alberta oilsands. That's how confident TransCanada was of winning approval.

But clearly it wasn't taking local politics in Nebraska into consideration. The Republican governor strongly opposed the pipeline route. And environmental activists used the Keystone project as a surrogate for their real target, the oilsands, which they call the tarsands.

In fact the Americans have no lessons to teach Canada on this issue. Canada accounts for 1.9 per cent of global greenhouse-gas emissions, and the oilsands account for less than five per cent of that.

Meanwhile, the carbon footprint from the coal-fired energy industry in the U.S. is 64 times that of the oilsands.

The delay of the Keystone project only underlines the fact that the United States is the only customer for our oil, some 2.4 million barrels a day.

It also makes the case for Enbridge's proposed $5.5-billion Northern Gateway pipeline, which would move 525,000 barrels per day from the oilsands to the West Coast.

This project also faces strong opposition from environmentalists and some of the 45 First Nations along the proposed route. A regulatory review beginning in January will include three months of hearings in communities along the way.

As Harper put it during the Asia-Pacific Economic Cooperation summit in Hawaii last weekend: "This does underscore the necessity of Canada making sure that we're able to access Asian markets for our energy products."

While Pacific Gateway is far from being a slam dunk, at least its fate will be determined in Canada alone, in the exercise of our own sovereignty, without being subjected to seasonal political storms in the U.S.

But here's the thing. The oilsands already account for about half of our daily production, and oilsands production is expected to double to 2.2 million barrels by 2015 and triple to 3.5 million barrels a day by 2025.

At some point, if Keystone and Pacific Gateway are delayed indefinitely, Canada's production of oil will exceed our capacity to transport it.

 
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