From the Daily Caller News Foundation

By David Blackmon

In a post on his Truth Social media platform Monday night, President Donald Trump said he still wants to see the Keystone XL pipeline through to completion. Here is the full text of the president’s post:

“Our Country’s doing really well, and today, I was just thinking, that the company building the Keystone XL Pipeline that was viciously jettisoned by the incompetent Biden administration should come back to America, and get it built — NOW! I know they were treated very badly by Sleepy Joe Biden, but the Trump Administration is very different — Easy approvals, almost immediate start! If not them, perhaps another Pipeline Company. We want the Keystone XL Pipeline built!”

For those unaware, the company that spent a decade attempting to finance, obtain permits, and build the Keystone XL pipeline project is TC Energy  (formerly Trans Canada), which is headquartered in Calgary, Alberta, Canada.

Fraught with controversy from the beginning, Keystone XL became a true political football during the Barack Obama presidency as the anti-oil and gas lobby in the U.S. mounted a disinformation campaign to kill public support for it. The mounting of the costly disinformation campaign made the process of obtaining permits at all levels of government – state, local, and federal – far more difficult and time-consuming, needlessly running up the project’s cost in the process.

After the Obama State Department led by Secretary John Kerry refused to issue the international cross-border permit required to complete the line, Trump quickly acted to ensure its approval early in his first term in office. By the time Joe Biden assumed office in January 2021, TC Energy had invested billions of dollars – creating thousands of high-paying jobs in the process – and well over half the line was already in the ground. Still, despite the huge sunk cost and lacking an ability to cite any instance in which TC Energy stood in violation of any U.S. law or regulation, Biden took the extraordinary, indefensible step of cancelling the project with the stroke of a pen.

But can the project really be revived now? It’s an important question given that Keystone XL was designed to bring as many as 830,000 barrels of Canadian oil per day into the United States for refining and delivery to markets.

Here, it is key to note that – as I pointed out last November when then-President-elect Trump raised this topic – TC Energy is no longer the owner of the moribund project. The remnants of Keystone XL were included in a group of assets TC Energy spun off last year when it formed a new company named South Bow Energy.

Complicating matters further is the fact that, after it decided the pipeline was a lost cause back in 2021, TC Energy pulled the installed pipe out of the ground so it could be repurposed for other projects in its portfolio. Then, there’s the fact that many of the permits the company spent years trying to obtain from various levels of governments are no longer valid and would have to go through the application and approval processes again were the project to be revived.

At the federal level, the Department of Interior and FERC would govern most of the necessary permitting processes. President Trump ordered all of his departments and commissions in January to research ways the executive branch can streamline the federal processes and Interior Secretary Doug Burgum included that goal as one of his 6 top priorities in a memo to staff dated February 3.

But even if those projects are successful in speeding up permitting at the federal level, they would have no impact on such challenges at the state and local levels. Activist groups who organized the opposition to the project saw great success in holding up permitting issuances at these lower levels of government, and would no doubt revive that strategy to attack any effort to restart the pipeline.

There can be no doubt that Trump’s desire to get the pipeline built is a laudable goal from a commercial, environmental and national security standpoint. Whether it is a practical goal is another question with many factors arrayed in opposition to it.

But one thing I’ve learned long ago is to never underestimate Donald Trump’s ability to get a deal done, so no one should give up hope just yet.

David Blackmon is an energy writer and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.

From the Canadian Energy Centre

By Deborah Jaremko

ARC Energy Institute leaders highlight the need for a new approach in a new reality

Despite Canada’s status as one of the world’s largest oil and gas producers, more than half of the country’s own population does not have true energy security – uninterrupted, reliable access to the energy they need at an affordable price.

Even though Western Canada produces much of the oil consumed in Ontario and Quebec, in order to get there, it moves on pipelines that run through the United States.

“It’s only energy secure if the Americans are our partners and friends,” leading energy researcher Jackie Forrest said on a recent episode of the ARC Energy Ideas podcast.

Amid rising trade tensions with the United States, energy security is taking on greater importance. But Forrest said the issue is not well understood across Canada.

“The concern is that in the worst-case scenario where the Americans want to really hurt our country, they have the ability to stop all crude oil flows to Ontario,” she said.

That action would also cut off the majority of oil supply to Quebec.

The issue isn’t much better for natural gas, with about half of consumption in Ontario and Quebec supplied by producers in the U.S.

“Tariffs or no tariffs, there is a real vulnerability there,” said Forrest’s co-host Peter Tertzakian, founder of the ARC Energy Research Institute.

The issue won’t go away with increased use of new technology like electric cars, he said.

“This isn’t just about combustion in engines. It’s about securing a vital commodity that is an input into other parts of our manufacturing and sophisticated economy.”

Oil: The Enbridge Mainline

The Enbridge Mainline is the main path for oil from Western Canada to reach refineries in Ontario and Quebec, according to the Canadian Association of Petroleum Producers (CAPP).

Originating in Edmonton, Alberta, the Enbridge Mainline moves crude oil, refined products, and natural gas liquids through a connected pipeline system. At Superior, Wisconsin, the system splits into Line 5, going north of Lake Michigan, and Lines 6, 14, and 61, going around the southern tip of the lake. The two routes then coalesce and terminate in Sarnia, Ontario, where it is interconnected with Line 9, which is terminated in Montreal, Quebec. Source: Canadian Association of Petroleum Producers

Originally built in 1950 from Edmonton to Superior, Wisconsin, in 1953, it was extended to Sarnia, Ontario through a segment known as Line 5.

CAPP said that at the time, politicians had pushed for an all-Canadian path north of the Great Lakes to increase energy security, but routes through the U.S. were chosen because of lower project costs and faster timelines.

In 1979, an extension of the pipeline called Line 9 opened, allowing oil to flow east from Sarnia to Montreal.

“Line 9 was built after the oil crisis and the OPEC embargo as a way to bring western Canadian crude oil into Quebec,” Forrest said.

But by the 1990s – before the massive growth in Alberta’s oil sands – there was a lack of crude coming from Western Canada. It became more economically attractive for refineries in Quebec and Ontario to import oil from overseas via the St. Lawrence River, CAPP said.

A reversal in 1999 allowed crude in Line 9 to flow west from Montreal to Sarnia.    

By the 2010s, the situation had changed again, with production from the Alberta oil sands and U.S. shale plays surging. With more of that oil available, the offshore crude was deemed to be more expensive, Forrest said.

In 2015, Line 9 was reversed to send oil east again from Sarnia to Montreal, displacing oil from overseas but not resolving the energy security risk of Canadian pipelines running through the U.S.

CAPP said the case of Line 5 illustrates this risk. In 2020, the Governor of Michigan attempted to shut down the pipeline over concerns about pipeline leak or potential oil spill in a seven-kilometre stretch under the Straits of Mackinac.

Line 5 has been operating in the Straits for 72 years without a single release.

Enbridge is advancing a project to encase the pipeline in a protective tunnel in the rock beneath the lakebed, but the legal battle with the State of Michigan remains ongoing.

Natural gas: The TC Canadian Mainline

The natural gas pipeline now known as TC Energy’s Canadian Mainline from Alberta was first built in 1958.

The TC Canadian Mainline (red dashed line) transports natural gas produced in Western Canada to markets in Eastern Canada. Red lines show pipelines regulated by the Canada Energy Regulator, while black lines show pipelines regulated by the United States. Source: Canadian Association of Petroleum Producers

“This pipeline brought gas into Ontario, and then it was extended to go into Quebec, and that was good for a long time,” Forrest said.

“But over time we built more pipelines into the United States, and it was a better economic path to go through the United States.”

The Mainline started running not at its full capacity, which caused tolls to go up and made it less and less attractive compared to U.S. options.

According to CAPP, between 2006 and 2023 the Mainline’s deliveries of gas from Western Canada to Ontario and Quebec were slashed in half.

“We should have said, ‘We need to find a way for this pipeline, over our own soil, to be competitive with the alternative’. But we didn’t,” Forrest said.

“Instead, we lost market share in Eastern Canada. And today we’re in a big bind, because if the Americans were to cut off our natural gas, we wouldn’t have enough natural gas into Quebec and Ontario.”

A different approach for a new reality

Forrest said the TC Mainline, which continues to operate at about half of its capacity, presents an opportunity to reduce Canada’s reliance on U.S. natural gas while at the same time building energy security for oil.    

“Those are the same pipes that were going to be repurposed for oil, for Energy East,” Tertzakian said.

“The beauty of the thing is that actually, I don’t think it would take that long if we had the will… It’s doable that we can be energy secure.”

This could come at a higher cost but provide greater value over the long term.

“That’s always been the issue in Canada, when it comes to energy, we always go with the cheapest option and not the most energy secure,” Forrest said.

“And why? Because we always trusted our American neighbor to never do anything that will impact the flow of that energy. And I think we’re waking up to a new reality.”