TransCanada's Keystone XL delay plan seen as both sound strategy and desperate measure

TransCanada's latest move in its bid to save the proposed Keystone XL pipeline from being rejected in the United States is being described as both sound strategy and a desperate measure — depending on who you ask.

Company asking U.S. government to pause its review of a presidential permit application

Russ Girling, TransCanada's president and chief executive officer, asked the U.S. State Department to pause its review of Keystone XL one day before third quarter earnings were reported to be down 12 per cent. (Jeff McIntosh/Canadian Press)

TransCanada's latest move in its bid to save the proposed Keystone XL pipeline from being rejected in the United States is being described as both sound strategy and a desperate measure.

The company's decision to ask the U.S. State Department to pause its review of the presidential permit application on the controversial pipeline could breathe new life into a project that had been seen by many as "dead in the water," according to Trevor McLeod of the Canada West Foundation.

McLeod, director of the public policy think-tank's Centre for Natural Resources Policy, said the request, if approved, would give TransCanada an opportunity to address the project's strong opposition south of the border.

The company predicts it needs about a year to settle a dispute in Nebraska over the proposed route of the pipeline, which would carry crude from Alberta to Texas.

TransCanada sent a letter to U.S. Secretary of State John Kerry on Monday, saying it believes there is sound precedent for making the request to pause the review.

'Unusual' move

The U.S. State Department said it is still reviewing TransCanada's request, and the White House expressed skepticism Tuesday about the idea of a pause in the proceedings.

Given how long the process has taken already, U.S. President Barack Obama's press secretary, Josh Earnest, told reporters it would be "unusual" for the review to be further delayed.

Even if a delay is approved, McLeod said the pipeline's ultimate fate would likely still depend on who wins the 2016 U.S. presidential election.

"It has become a political football with the Democrats, including the current president and Hillary Clinton saying they're not in favour," he said.

"The Republicans all seem to be on side with the pipeline."

Smart move

University of Calgary energy economist Michal Moore also thinks the delay request is a smart move for TransCanada.

If the delay is granted, Moore said the company "literally can recreate the project or reimagine it and certainly revisit it in the presence of a new president."

Mike Hudema, who is with the environmental group Greenpeace, characterized the move differently, calling it a "desperate bid to delay the process in hopes of getting a president in the White House who will ignore climate science."

"President Obama already has all the evidence he needs to reject Keystone XL," Hudema said in an email.

"It's time he did just that so we can start building the green energy future the world needs to see."

3rd-quarter results

TransCanada also announced third-quarter results Tuesday, revealing that profits were down from the same quarter in 2014, despite higher revenue.

Net income attributable to the company fell 12 per cent to $402 million, or 57 Canadian cents per share, in the three months ended Sept. 30.

Revenue rose 20.1 per cent to $2.94 billion.


To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.

Become a CBC Member

Join the conversation  Create account

Already have an account?