Cancelled pipeline disappoints province’s businesses, towns

SASKATOON TransCanada Corp.’s decision to scrap its proposed Energy East pipeline did not come as a major surprise, but the $15.7- billion project’s cancellation amid what some have described as a “dysfunctional” regulatory environment prompted very different reactions across Saskatchewan.

“I’m disappointed, but it’s not TransCanada’s fault,” said Moosomin Mayor Larry Tomlinson, whose town was expected to be a major hub on the massive pipeline and reap the accompanying economic benefits. “I think it pretty much got shot down down east, as far as I understand, and I don’t think they understand what they did either.”

Tomlinson said the company’s decision makes little sense, as it means Western Canada will suffer a significant economic blow. Estimates have suggested Energy East would create more than 14,000 jobs each year, and add $55 billion to the country’s gross domestic product while the east will continue to rely on foreign oil.

The mayor’s concerns were echoed by Saskatchewan Chamber of Commerce CEO Steve McLellan, who pointed out that imported oil often comes from countries with questionable labour laws and human rights records. The business advocacy group’s head said Energy East would have poured “hundreds of millions of dollars” into Saskatchewan over its lifetime.

Calgary-based TransCanada said Thursday it would not proceed with the controversial project. Energy East was unveiled in 2013 and promised to carry an estimated 1.1 million barrels of Western crude to refineries in Eastern Canada and a port terminal in New Brunswick. The pipeline would have run from Hardisty, Alta., through southern Saskatchewan and into Manitoba.

“I’m not surprised, but I was certainly disappointed,” McLellan said, adding he believes the project’s failure is the result of a lack of political will at the federal level, both from the current Liberal government and its Conservative predecessor. That unwillingness to fundamentally re-examine Canada’s energy future, he said, is a “disaster.”

Tim McMillan, CEO of the Canadian Association of Petroleum Producers, said the Energy East cancellation would force Canada to rely more on the U.S. to be its “broker” for oil and gas produced domestically at a time when the North American Free Trade Agreement is being renegotiated.

A poll conducted this summer by Mainstreet Research and Postmedia found that 67 per cent of Saskatchewan residents supported the 4,600-kilometre pipeline, while 19 per cent disapproved and 14 per cent said they weren’t sure. Mainstreet’s executive vice-president said at the time that many saw the project intertwined with the broader economy.

Not everyone was disappointed with TransCanada’s decision — which its chief executive attributed to “changed circumstances.”

Montreal Mayor Denis Coderre, a longtime opponent of the project, said on social media that it was a major victory.

Climate Justice Saskatoon spokesman Mark Bigland-Pritchard, whose organization promotes the increased use of renewable energy sources amid a “managed decline” in the oil industry, said he was “very, very happy” with the decision, which he attributed to the NEB changing its guidelines to include a “proper audit” of the project’s climate impact.

Energy East’s cancellation represents a tacit acknowledgment that development of Alberta’s oilsands is finished, but it is not enough to simply scrap the pipeline, the environmental activist said. The government must also work to create new jobs in “green” energy sectors that have neither the emissions nor the cost of Energy East.

Bigland-Pritchard said “we need to move rapidly toward a cleaner economy in any case and … you get more jobs per $1,000 invested, per $1 million invested than you do with anything in the fossil fuel industry.”