In the News (pipelines)

Here we have some pipeline politics in the news. Now, in my biased opinion, Keystone XL is a no brainer. That Obama can really only say no to the border crossing (wouldn't it be hilarious to see a pipeline up to the border on both sides, and a bunch of rail-cars running non-stop across the border?), the refinery complex on the gulf coast wants our oil, we want to sell our oil, and MOST IMPORTANTLY citizens of both our countries continue to want to consume oil products, requires us to get on with it.

Now of course that all rests on the assumption that the Oil Sands (or Tar Sands, it's all just symantics) aren't the worst thing in the world. Which is a whole 'nother conversation.



All that aside, the stories below outline a few items in the news. First, I think Obama wants to say yes. Just like he sandbagged on gay marriage and is sandbagging on pot legalization, I believe he's just playing politics with this thing, waiting for an opportune time (like when the State Department review says this oil will get to market regardless and this resource will get developed). Of course saying no to XL will slow the oilsands development, but by an appreciably amount? Depending on metric it's plausible that Obama will face alot of pressure to say no. This article by Market Watch (citing an RBC Capital Market report) estimates that it may reduce capital budgets in the 5-10% range. My guess is that a 1% reduction in Oilsands spending would be enough for some opposition.

Next we get Trudeau, for a Canadian that enjoys following international politics, I have to admit to not really following Canadian politics. By and large, it just doesn't matter much. That being said, Trudeau claims to be for the Keystone (and maybe Energy East? although the quote from this article is, "the [substance] that they put to make that thick crude, thick bitumen run through those pipes can be very toxic" so I'm not too sure how thought out his opinions on the topic are) and against the Northern Gateway.

But to me it all just seems to be politics. Pipelines just make sense for Canada. Opening up the Asian markets just make sense for Canada. Trudeau needs the environmental vote. He couldn't be much more vague on what sort of environmental considerations need to be addressed or what routing would work for a pipeline west. But what would he have to gain at this stage politically by giving a realistic path to pipelines?

That said, I wonder if Trudeau were at the helm, if that would give Obama the political cover he (in my opinion) desires to approve Keystone? Would Trudeau have that "over the course of several years" type of moment that placates a very vocal and influential minority? Would presenting something beyond pointing out the obviousness of the pipeline (to people who don't find it so obvious), help the process? I think so. Would Trudeau be the person to get that message across? He hints at it, but is vague on the environmental terms laws he'd put fourth. So it' might just be wishful thinking, but then again, it is politics, so who knows?

The last story, of course, is the status quo. Redford heading south. I'm guessing her public message will be more of the same, similar to the results. Obama needs to save face with his base if he's going to approve the Keystone XL, what's going to break the status quo? The man got Putin to take Assad's chemical weapons. He'll get this done.

Final Keystone review assesses potential of oil-by-rail

As it prepares a final environmental review of the $5.3-billion oil pipeline, the State Department has asked crude-by-rail executives about supply-chain logistics, market dynamics and potential obstacles to delivering 830,000 barrels per day of Canadian crude to Gulf Coast refiners, as Keystone would do.

In March the State Department concluded that halting the project would do little to slow oil sands output, since crude-by-rail transport could nearly fill the gap. But the Environmental Protection Agency disputed that, saying higher rail costs could limit growth.

Once the State Department review is completed, foes and supporters of the pipeline are likely to begin a fresh lobbying blitz. And administration officials have said they will be open for more public comment on a project that has been in limbo since 2008.

Strong environmental laws would have secured Keystone, Trudeau tells Alberta oil leaders

In a speech just a day before Conservatives descend on Calgary for their national convention, federal Liberal Leader Justin Trudeau attempted to shift attention to his party’s energy policy, and make the case that his party isn’t the bogeyman many in the West perceive it to be.

Mr. Trudeau said the pipeline – which would transport Alberta oil-sands bitumen to lucrative markets on the Texas Gulf Coast – would have already been given the green light if Canada had stronger, more cohesive environmental policies, including tougher penalties for polluters and a means for pricing carbon. 

“It is the absence of strong policy that makes us an easy target,” Mr. Trudeau said, in reference to misgivings U.S. President Barack Obama has expressed about Canada’s ability to reduce greenhouse-gas emissions, and criticism from environmental groups.

Redford to travel to Washington to discuss Keystone pipeline

Alberta Premier Alison Redford will make her fifth trip to Washington next month to speak about the need for the Keystone XL pipeline. 

She will meet with officials in the U.S. State Department as they finalize an environmental assessment of the proposed transcontinental pipeline.