Do we really need Keystone? As Obama dithers, Canada moves on other options – by Claudia Cattaneo (National Post – July 30, 2013)

The National Post is Canada’s second largest national paper.

President Obama’s latest smug comments on the Keystone XL oil sands pipeline suggest the Canadian project’s odds of being approved under his watch are waning.

Thankfully, Canada hasn’t stood still while the U.S. President dithered. So many new pipeline options have emerged that Keystone XL’s relevance is diminishing as each one gains momentum.

Sure, it will be hard to fill Keystone XL’s void and promise over the short term — perhaps a couple of years around 2016 and 2017 until new pipeline options are up and running.

But over the long-term, Canada is better off fast-tracking oil market diversification to global markets that are not beholden to U.S. anti-oil interests and that remain very motivated to buy Canadian supplies.

Two all-Canadian options — TransCanada’s Energy East project from Alberta to New Brunswick, and pipelines from Alberta to the West Coast — made big leaps forward in the past few days.

On Friday, TransCanada, the Keystone XL proponent, said it’s optimistic about its Energy East project, involving a conversion to oil service of its gas Mainline that could start delivering Alberta oil as far as New Brunswick in 2018. TransCanada said it plans to finalize agreements with prospective shippers in the next two weeks. Energy East would single-handedly replace Keystone XL, which would not be ready to move oil until 2016 even if approved by the end of the year.

Also on Friday, Alberta’s Alison Redford and British Columbia’s Christy Clark announced after the premiers’ annual meeting in Niagara-on-the-Lake that they would work together to “build new markets and get the highest price possible for the resources owned by the people of our two provinces.”

It’s a huge step forward to resolve the two provinces’ differences over bitumen pipelines to the West Coast and achieve a fairer distribution of risk and benefits. Enbridge Inc.’s proposed Northern Gateway pipeline would deliver 525,000 b/d of Alberta oil to Kitimat by around 2017, and Kinder Morgan’s TransMountain pipeline expansion would deliver an additional 590,000 b/d of Alberta oil to Vancouver by around 2017.

“Alison and I have been having this [discussion] together as premiers,” Ms. Clark said. “We want to take the next concrete step in that journey and have our officials sit down and start really grinding through some of the details to find out where we can find common ground, where we disagree and where we need to try to work a little harder.”

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