TC Energy said it is suspending the project in light of the expected Biden action.
Biden will revoke the presidential permit granted to Keystone XL within hours of taking the oath of office later today, one of many executive orders planned to reverse policies from President Donald Trump, according to a statement from the transition team of Biden and vice president-elect Kamala Harris.
TC Energy said it will review the decision, assess its implications, and consider options. “However, as a result of the expected revocation of the presidential permit, advancement of the project will be suspended,” the company said.
The $8bn pipeline began construction last year and was not expected to be placed into service until 2023. TC Energy proposed the project more than a decade ago to offer another option to move western Canadian crude to the US. The line would move crude from Hardisty, Alberta, to Steele City, Nebraska, where it would connect with other TC Energy pipelines to Cushing, Oklahoma, and the southeast Texas coast.
Blocking Keystone XL has been a major goal of environmentalists as a symbolic measure and because halting the pipeline would increase the cost of developing oil sands that have relatively high carbon-intensity.
TC Energy said Biden’s decision to revoke the Keystone XL permit “would overturn an unprecedented, comprehensive regulatory process that lasted more than a decade and repeatedly concluded the pipeline would transport much needed energy in an environmentally responsible way while enhancing North American energy security.”
TC Energy had taken steps that it hoped would make it legally and politically harder to block the project. The company last year completed a short border-crossing section that is covered by the presidential permit. It also signed contracts with unionized pipeline contractors in the US and finalized an agreement to allow indigenous groups to buy up to $763mn (C$1bn) in equity in Keystone XL. The company on 17 January also announced the pipeline would have its operations powered entirely by renewable energy by 2030.
Rescinding the presidential permit for Keystone XL could frustrate efforts to repair US relations with Canada, whose prime minister Justin Trudeau supports the project.
Alberta premier Jason Kenney said over the weekend he was “deeply concerned” about reports that Biden would repeal the presidential permit. If the incoming administration blocks the permit, Alberta intends to work with TC Energy to “use all legal avenues available to protect its interest in the project.” Alberta invested $1.1bn in the pipeline last year.
Oil industry groups say the pipeline has been subject to exhaustive environmental reviews and should be completed.
The project was first proposed in 2008, but it has been delayed repeatedly. Former US President Barack Obama in 2015 blocked Keystone XL after years of review, citing environmental concerns. The project was revived in 2017, with a cross-border permit from the Trump administration.
Stuart Turley is President and CEO of Sandstone Group, a top energy data, and finance consultancy working with companies all throughout the energy value chain. Sandstone helps both small and large-cap energy companies to develop customized applications and manage data workflows/integration throughout the entire business. With experience in implementing enterprise networks, supercomputers, and cellular tower solutions, Sandstone has become a trusted source and advisor in this space. Stuart has led the “Total Corporate Digital Integration” platform at Sandstone and works with Sandstone clients to help integrate all aspects of modern digital business. He is also the Executive Publisher of www.energynewsbeat.com, the best source for 24/7 energy news coverage and is the Co-Host of the energy news video and Podcast Energy News Beat.
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