Keystone pipeline: Five years later, a changed energy dynamic
The Keystone pipeline was first proposed five years ago. A lot has changed since then and the Canadian economy is starting to ponder a future that's less coupled to the US energy market, Graeber writes. TransCanada, with its domestic pipeline proposal, is already hedging its bets on the Keystone pipeline.
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Supporters and detractors of the Keystone XL oil pipeline made their voices known Thursday, the 5th anniversary of TransCanada's permit application to the U.S. State Department. TransCanada needs a federal permit to build the section of the pipeline that would cross from Alberta oil fields into Montana. American Petroleum Institute President Jack Gerard said Keystone XL would displace oil from "unstable parts of the world" with North American crude. But by Oliver's own admission, production gains in the U.S. market means "it will need Canadian resources less in the future." (Related Article: Obama’s Latest Comments Cast Even More Doubt on Keystone XL Approval)Skip to next paragraph
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Oliver mid-September touted the potential economic benefits from TransCanada's Energy East pipeline proposal. That project would stretch some 2,700 miles from oil fields in Alberta and Saskatchewan to eastern Canadian refineries, which currently rely on foreign imports. TransCanada said the pipeline would deliver 1.1 million bpd to eastern refineries, nearly 25 percent more than Keystone XL. The Canadian government estimates Energy East would generate more than $30 billion in gross domestic product and another $9.7 billion in tax revenue.
When Keystone XL was first proposed, the United States was producing about 5 million barrels per day. In August, the United States produced 7.6 million bpd, the highest monthly level in 24 years. Against the backdrop of clamoring over job prospects, energy security, pipeline corrosion and greenhouse gas emissions is the changing dynamic in the North American energy market since Keystone XL was put on the table. Oliver's comments show the Canadian economy is starting to ponder a future that's less coupled to the U.S. energy market. TransCanada, with its domestic proposal, is already hedging its bets.
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