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The $12-billion Energy East pipeline announced by TransCanada Corp. Thursday is the third nation-building project proposed by the Canadian energy industry in the past dozen or so years. The Mackenzie gas pipeline that would have opened and enriched the North failed, and the Northern Gateway oil pipeline to usher new trade with Asia is in trouble.
Many lessons were learned. Big losses were suffered. Changes were made. Today, Canada can and must pull off Energy East, which would truly make the country oil rich.
Started as an after-thought after the United States delayed approval of Keystone XL, the Alberta-to-New Brunswick pipeline promises the biggest benefits yet to Canadians from its energy patrimony, while ensuring the best environmental protection that can be had.
“This is a historic day for TransCanada and a historic day for our country,” said CEO Russ Girling said, comparing the project to other nation-building projects such as the Canadian Pacific Railway, the Trans-Canada Highway and the company’s own cross-country natural gas mainline, which will be the foundation of Energy East.
With the project gearing up to deliver up to 1.1 million barrels per day to refineries and export terminals in Quebec in late 2017 and New Brunswick in 2018, Alberta and Saskatchewan would get a new home for their growing production.
Eastern Canadian consumers would replace higher-cost oil imports with cheaper and better-regulated Western Canadian oil. Refineries in Quebec and New Brunswick would get access to secure, cheaper supplies and the opportunity to expand. Across the country, Canadians would get the employment benefits that come with a massive infrastructure project funded entirely by industry.
As well, Canada would lessen its dependence on the United States, whose president has been signaling in recent weeks that the Keystone XL pipeline from Alberta to the Gulf Coast could be headed for another delay.
The big advantage of Energy East over the other troubled Canadian pipelines is that it doesn’t come with big baggage. Both the Mackenzie and Northern Gateway projects would have crossed remote First Nations lands with unsettled claims. Both projects became platforms for aboriginal grievances that were tough to resolve.
Instead, most of Energy East is already in the ground. The project would convert parts of the under-utilized 3,000-kilometre gas pipeline from Alberta to Quebec to oil service, and involve another 1,400 kilometres of new pipeline build from Quebec to New Brunswick.
The other advantage is that TransCanada, like the rest of Canada’s energy sector, has upped its game dealing with opposition, largely from the environmental movement, but also ensuring that its operations are safe and use the latest available technology.
Gone are the days when pipeline routes were based on the cheapest distance from the wellhead to the refinery, consultations with communities were secondary to economic benefits, information was scarce. TransCanada pulled out all the stops Thursday to explain the project, its benefits and its challenges, including making available its top brass in both Calgary and Montreal to field questions in both official languages and committing to consult with all affected parties.
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