The Current

Is Keystone XL pipeline approval good news for Canada?

Yesterday U.S. President Donald Trump signed new life into the controversial Keystone XL pipeline. But with plans afoot for Canada's own pipelines and lingering environmental concerns, is the return of Keystone something for Canada to celebrate?
U.S. President Donald Trump signs a presidential memorandum on the Keystone XL pipeline, Jan. 24, 2017, to renegotiate some of the terms that will create 'great construction jobs.' (Evan Vucci/Associated Press)

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U.S. President Donald Trump signed a presidential memorandum on Jan. 24 that put the controversial Keystone XL pipeline back in play.

"It's subject to a renegotiation of terms by us," President Trump said of the mega-project.

"We'll see if we can get that pipeline built. [It's] a lot of jobs, 28,000 jobs. Great construction jobs."

President Trump's predecessor, Barack Obama, had vetoed legislation approving construction arguing the pipeline —which would move bitumen from the Alberta oil sands to refineries in the U.S. south — would be environmentally unsound.

The benefits of this project are manifest for Canada and they mostly relate to the improved economics.- Dennis McConaghy
Dennis McConaghy, a retired senior executive with TransCanada, the company behind Keystone tells The Current's guest host Connie Walker that it's a significant revival of the project.
U.S. president Donald Trump says if pipelines are built in the United States, they should use U.S. steel. (Alex Panetta/Canadian Press)

"It's notable that before the day was even over yesterday TransCanada responded publicly that they intend to reapply," McConaghy says regarding the necessary permits.  

McConaghy sees the pipeline as a benefit to Canada in terms of transportation economics: increasing oilsand production in Alberta will have employment impacts, and also opportunities for Canadian pipe manufacturers in the construction process. 

"The benefits of this project are manifest for Canada and they mostly relate to the improved economics within the oilsands sector once this infrastructure is in place."

Keystone's environmental impact

Simon Dyer, director for Alberta at the Pembina Institute — a nonprofit think-tank that focuses on climate change and energy issues — says the Keystone XL would make it much harder for Canada to make the carbon emission reduction commitments agreed to at the 2015 Paris climate change conference.
Alberta Premier Rachel Notley applauds Trump's Keystone XL approval saying the project will create jobs for Albertans. (Jonathan Hayward/CP)

"The math still doesn't add up … We're not on track to achieve our targets, and facilitating further oil sands expansion is going to take us further away from those targets," Dyer tells Walker. 

"Until we can square that circle, you're going to see opposition and pipelines are caught in the middle."

McConaghy says the real test is if Canada will stick to its international carbon reduction commitments.

We need to put more policies in the window to achieve our emission reductions.- Simon Dyer

"But Canada is not alone in this. All of those countries - especially the most developed ones - [must decide if] they have the will to meet those targets or whether they are just aspirations in a world that has to balance the economic value that hydrocarbons provide and internalizing the risk of climate change."

For Dyer the bigger question moving forward is what the federal government's overall plan is deal with climate change.

"Clearly, modern regulators need to incorporate climate change into the decision making, and that isn't happening yet," says Dyer.

"We need to put more policies in the window to achieve our emission reductions."

Listen to the fulls segment at the top of this web post.

This segment was produced by The Current's Kristin Nelson and Calgary network producer Michael O'Halloran.