Keystone XL is Rejected Energy East to Follow

TransCanada’s tar sands pipelines are being thwarted at every turn. US President Barack Obama has officially rejected the Keystone XL and the new Canadian Prime Minister Justin Trudeau is expected to cancel the Energy East. President Obama rejected the Keystone citing the economics associated with low oil prices. He also said that building the KXL would be inconsistent with US leadership on climate change. The $7 billion, 1,179 mile-long KXL would have ferried 800,000 barrels a day of heavy crude oil from the tar sand pits in Alberta Canada to refineries on the Gulf of Mexico.

Last week TransCanada announced a new route for the Energy East pipeline that excluded an oil export terminal in Cacouna northeast of Quebec city. The terminal was abandoned 6 months ago due to a public outcry over the impact the project would have on the habitat of beluga whales.

The $12 billion, 4,600-kilometre Energy East pipeline would transport 1.1 million barrels of crude each day. from Alberta to Canada’s east coast. It is scheduled to be completed in 2020 the year that a hoped-for global climate agreement would come into effect.

The change comes only a matter of days after TransCanada requested a pause in the US State Department’s consideration of the Keystone XL pipeline. The request was subsequently denied and then on November 6th, the KXL pipeline was canceled outright after many years of wrangling.

In response to the news, TransCanada said that the fight for the Keystone XL is not over. They are also working on ways of keeping the Energy East afloat. They have submitted new plans for the Energy East to Canada’s National Energy Board. The revised route for the Energy East pipeline excludes a port in Quebec and goes directly to Irving Oil’s massive refinery in Saint John, New Brunswick.

While the company is trying to put a brave face on the cancellation of the Keystone XL and the rerouting of the Energy East, they are having an increasingly difficult time moving forward with their pipedreams.

The situation is destined to get worse for TransCanada as the new Liberal government has promised to prevent oil shipping along Canada’s west coast and cancel the Energy East outright. TransCanada explained the rerouting indicated that their decision was made after “conducting thorough studies and consulting with many local communities,” Energy East president John Soini said.

Quebec Premier Philippe Couillard has questioned the economic, employment, and environmental benefits of the Energy East and he said that his province will not just be a passageway for the pipeline. Citing climate and other concerns, environmental groups oppose the building of the pipeline altogether.

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