How Alberta’s oil patch teamed up with the ‘little guys’ for an end run around Obama – by Rebecca Penty, Hugo Miller, Andrew Mayeda and Edward Greenspon (National Post – October 8, 2014)

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

Bloomberg News – So you’re the Canadian oil industry and you do what you think is a great thing by developing a mother lode of heavy crude beneath the forests and muskeg of northern Alberta. The plan is to send it clear to refineries on the U.S. Gulf Coast via a pipeline called Keystone XL. Just a few years back, America desperately wanted that oil.

Then one day the politics get sticky. In Nebraska, farmers don’t want the pipeline running through their fields or over their water source. U.S. environmentalists invoke global warming in protesting the project. President Barack Obama keeps siding with them, delaying and delaying approval. Keystone has become a tractor mired in an interminably muddy field.

In this period of national gloom comes an idea — a crazy-sounding notion, or maybe, actually, an epiphany. How about an all-Canadian route to liberate that oil sands crude from Alberta’s isolation and America’s fickleness? Canada’s own environmental and aboriginal politics are holding up a shorter and cheaper pipeline to the Pacific that would supply a shipping portal to oil-thirsty Asia. So, instead, go east — all the way to the Atlantic.

Thus was born Energy East, an improbable pipeline that its backers say has a high probability of being built. It will cost $12-billion and could be up and running by 2018. Its 4,600-kilometer path, taking advantage of a vast length of existing and underused natural gas pipeline, would wend through six provinces and four time zones. It would be Keystone on steroids, more than twice as long and carrying one-third more crude.

Its end point, a refinery in the blue-collar city of Saint John, N.B. operated by the Irving family, would give Canada’s oil-sands crude supertanker access to the same Louisiana and Texas refineries Keystone was meant to supply.

As well, Vladimir Putin’s provocations in Ukraine are spurring interest in that oil from Europe and, strange as it seems, Saint John provides among the fastest shipping times to India of any oil port in North America. Indian companies, having already sampled this crude, are interested in more. That means oil-sands production for the first time would trade in more than dribs and drabs on the international markets. With the U.S. virtually the only foreign buyer of Alberta’s oil, Canadian producers are subject to price discounts of as much as US$43 a barrel that cost Canada $30-billion a year.

And if you’re a fed-up Canadian, like Prime Minister Stephen Harper, there’s a bonus: President Obama can’t do a single thing to stop it.

“The best way to get Keystone XL built is to make it irrelevant,” said Frank McKenna, who served three terms as premier of New Brunswick and was ambassador to the U.S. before becoming a banker.

So confident of success is TransCanada Corp., the chief backer of both Keystone and Energy East, that Alex Pourbaix, the executive in charge, spoke of the cross-Canada line as virtually a done deal.

For the rest of this article, click here: http://business.financialpost.com/2014/10/07/energy-east-keystone/?__lsa=4d00-478f