Indigenous group to invest up to $1B in KXL
• TC Energy Corp. said Tuesday that Canadian Indigenous group Natural Law Energy will invest up to $ 1 billion in its Keystone XL oil pipeline, the first of what it says will be numerous such investments in the heavy oil project.
“This represents our first investment in Canada’s energy infrastructure and we are excited to partner with TC Energy as together, we will ensure that the pipeline is held to the highest levels of environmental and social responsibility,” Alvin Francis, president of Natural Law and chief of the Nekaneet First Nation, said in a release announcing the deal.
The Calgary- based pipeline giant said it had finalized an agreement with Natural Law, an Indigenous business backed by five First Nations in Alberta and Saskatchewan, to invest in the Alberta- to- Nebraska project that would connect heavy oilsands to refineries in the Gulf Coast.
“We are close to bringing in further partnerships in both Canada and the U. S. with other tribal nations,” Bevin Wirzba, TC Energy’s executive vice-president and president, liquids pipelines, said at an investor presentation.
Wirzba said the company has been “repositioning” the Us$14.4-billion project in an attempt to win more widespread support in the U. S. after years of delays.
Industry observers have expressed doubts that Indigenous ownership in the project or other strategies the company is employing will win over U. S. environmental organizations and Democratic Party politicians including president- elect Joe Biden who have opposed the project for years. Biden’s “Build Back Better” plan promises to shift the U. S. energy mix towards more renewable energy, phase out coal-fired power and eliminate subsidies for hydrocarbons.
“I still think it’s going to be extremely difficult to get the Biden administration to support the completion of this project,” said Dennis McConaghy, who was an executive responsible for Keystone XL and has since written books about its challenges.
Mcconaghy said the Indigenous ownership would help “at the margins,” as would the union work on the project, but he still believes Biden will use executive orders to try to chalk up climate wins while in office, because the Democratic Party lacks control of the U.S. Senate to usher in legislation to combat climate change.
Wirzba said the company believes “the steps that we’ve already taken with Keystone XL, we believe, have positioned it very favourably, particularly as we bring jobs to the economy next year — a key platform for the U.S. government as we recover from the COVID pandemic.”
The company has signed agreements with four U. S. labour unions, ensuring the entire project would be built with union labour. TC Energy has also established a training fund for those union workers to retrain for green energy jobs.
“We believe those steps have repositioned us very favourably, and you’ve seen the public support from the Canadian federal government even as recently as the last few weeks,” Wirzba said.
TC Energy president and CEO Russ Girling told the presentation there are currently about 3,000 people working on the project and the company is planning to recruit 15,000 workers on the project in the first quarter of 2021 — a timeline that would coincide with Biden taking office on Jan .20. U.S. President Donald Trump had famously granted KXL a presidential permit in his first week in office in 2017, after it was rejected by his predecessor Barack Obama.
To date, the company has built the border crossing between Canada and the U.S. for the pipeline. Work is underway on both sides of the border, but much of it has slowed in the U.S. after a federal judge in Montana ruled last year that the company could not complete work around waterways until the U.S. Army Corps of Engineers reconsiders the project’s impact on endangered species.
Earlier this year the Alberta government announced a $ 1.5- billion investment in the project and is providing a $6-billion loan guarantee for construction next year. Alberta Premier Jason Kenney has recently described the investment as an insurance policy against other pipeline projects, in particular as a hedge against the federally owned Trans Mountain pipeline expansion being delayed.
Kenney said Tuesday that the agreement between TC Energy and Natural Law would “help ensure that Keystone XL — and projects like it — continue to be built with the protection of the environment at the forefront of every decision.”
Keystone XL will likely be the last of three active oil export pipelines built out of Canada.
The Trans Mountain pipeline expansion is more than 27 per cent complete in the Vancouver region and 19 per cent complete overall, Trans Mountain Corp. spokesperson Allison Hounsell said in an emailed statement, which noted that 6,730 people are currently working on the Alberta-to B.C. oil conduit.
Construction work on the project is underway in both Alberta and British Columbia. Workers are preparing and clearing the pipeline route along the Coquihalla near Hope.
Hounsell said the company expects to begin construction in the Fraser Valley, which leads into the Vancouver area, next year or the year after.
Enbridge Inc.’s Line 3 replacement project is likely to be the first new oil pipeline project to be built and ship Canadian oil to U. S. refineries. The Calgary- based company expects construction to take between six and nine months and could be complete next year.
“Line 3 is a shovel- ready, $ 2.6- billion private investment that will bring 4,200 family- sustaining construction jobs, millions of dollars in local spending and tax revenues at a time when Northern Minnesota needs it the most,” Enbridge spokesperson Tracie Kenyon said in email.
The Alberta- to-wisconsin pipeline is built in each province and state with the exception of Minnesota, where it still needs U.S. Army Corps of Engineers permits, the Minnesota Pollution Control Agency’s Construction Stormwater permits and the Minnesota Public Utilities Commission authorization to construct.
While Enbridge progresses on Line 3, the company encountered a new challenge to its Line 5 project in Michigan last week, when Governor Gretchen Wilson notified the company the state was cancelling an easement for the company to cross a key strait in the Great Lakes.
Enbridge and Michigan will now litigate the issue in the state, but the notice provided Enbridge with 180- days notice it will need to stop flowing oil and products like propane through the line.