The Canadian government shows no signs of relaxing whatever pressure it can apply on the Obama administration to approve Keystone XL.
A team of senior cabinet ministers carried the message to a Goldman Sachs forum on North American energy earlier in June, driving home their government’s determination to obtain new outlets for Alberta oil sands production.
Finance Minister Joe Oliver, Natural Resources Minister Greg Rickford and Foreign Affairs Minister John Baird argued in media interviews and at the conference in New York that President Barack Obama has unfairly tied the US$5.4 billion pipeline to United States politics.
Oliver also made it clear that Canada intends to keep alive the importance of XL to U.S. energy security and the economy with the U.S. public and business.
Rickford combined that lobbying with a defense of Canada’s resource policies, while making an appeal to U.S. investors to participate in the industry.
The forum attracted top corporate executives and investors in the North American energy sector, including Vice President Joe Biden and Treasury Secretary Jacob Lew, along with policy experts and government officials from the U.S., Canada and Mexico.
Rickford said Canada has extensive and growing productive capacity, but needs access to the U.S. Gulf Coast refinery area, along with buyers in Asia and Europe.
Oliver said in an interview that he remained confident the U.S. government would operate like a democracy and listen to the wishes of its people.
He said XL is “not going to vanish as a business issue for those who are going to be directly impacted. Here’s a real sense (the series of delays within the Obama administration on reaching a decision) is a very unhappy delay.”
Oliver wasn’t willing to accept the administration’s argument that it is making every effort to consult widely on the pipeline, when it appeared the stalling was designed more to appease environmentalists.
“We feel entitled to say, ‘Wait a minute, this isn’t right, this isn’t fair,’” he said.
Baird, known for his straight talking, said the U.S. is intentionally delaying XL for political purposes, undermining the interests of a key ally and leading trade partner in the process.
Rickford told reporters that the delay is “an affront in no uncertain terms. It’s inconsistent with the principles that have helped our relationship at least economically evolve and, in that sense, it’s quite disruptive.”
But he also conceded that the U.S. demand for imported crude is likely to shrink as the U.S. ramps up its own output.
No climate change coverOliver, who occupied the natural resource cabinet post for three years, rejected suggestions that Prime Minister Stephen Harper could provide cover for Obama by introducing climate-change regulations for the petroleum industry, suggesting such a step would undermine the industry’s competitiveness, with no guarantee that such an initiative would sway Obama on XL.
“I don’t believe for one second that it would make any difference if in fact we did that,” he said. “Nobody has said to me in the U.S. administration, ‘We’re waiting for you to do that.’”
However, Oliver said it is a “fairly safe bet” that some of Canada’s domestic pipeline projects aimed at tanker terminals on the Pacific and Atlantic coasts - Enbridge’s Northern Gateway, Kinder Morgan’s Trans Mountain expansion and TransCanada’s Energy East - will be completed in the 2018-20 period.
“I simply can’t believe we won’t get this done because the stakes are too high,” Oliver said.
More pipeline sector supportThe Canadian pipeline sector received an added lift from a group of political and business leaders, who issued an open call for the federal government to clear the way for pipelines.
An open letter was signed by Saskatchewan Premier Brad Wall, Alberta Premier Dave Hancock and former premiers and cabinet ministers from across Canada.
British Columbia Finance Minister Mike de Jong said the Canadian government needs to make it clear to Americans that Canada has oil export options beyond North America.
“There are clearly some hurdles and challenges that we have to overcome to realize those options, but I think that can be done,” he said.