Vol. 26, No.27 Week of July 04, 2021
Providing coverage of Alaska and northern Canada's oil and gas industry

After scuttling Keystone XL, Biden won’t oppose Russian gas pipeline

Click here to go to the full PDF version of this issue, with any maps, photos or other artwork that appears in some of the articles.

Gary Park

for Petroleum News

President Joe Biden made a lot of promises during his election campaign and immediately after his inauguration about rebuilding relationships with America’s key allies.

For his closest and probably least troublesome friend - the Great White North - there are signs that the fence will need even more repairs than what Donald Trump left behind when he departed the White House.

What Canada now faces is picking up the pieces from Biden’s decision to scuttle TC Energy’s Keystone XL and his failure, so far, to make his position clear on Enbridge’s Line 3 and Line 5.

Nord Stream 2

Instead, he has mystified Canadians by expressing a willingness to drop actions on the Nord Stream 2 natural gas pipeline from Russia to Germany, while enthusiastically unveiling a multibillion-dollar domestic infrastructure program to upgrade roads, bridges and other transportation systems that will demand even greater sources of crude oil.

The curiosity surrounding Biden’s view of Nord Stream 2 first surfaced in mid-May when U.S. Secretary of State Antony Blinken suggested it was in the “national interest of the United States” to waive pipeline sanctions against Russia while at the same time opposing “the completion of this project.”

The sanctions had already been dismissed as toothless because they failed to restrict financing for the Russian pipeline.

The justification by the Biden administration that Nord Stream 2 was a “Russian geopolitical project intended to divide Europe and weaken European energy security” got sanctions relief when Washington felt it was unable to stop the nearly completed project and wanted to rebuild its friendship with Germany after four tense years under Trump.

Nord Stream v Keystone XL

U.S. Republicans were quick to attack Biden by drawing distinction between Nord Stream 2 and Keystone XL.

Sixty-eight Republicans in the House of Representatives slammed relief on the Russian pipeline in a letter that said: “Given your open hostility to domestic pipelines like Keystone XL, which was also a top priority for our Canadian allies, it is baffling that you are willing to green-light” Nord Stream 2.

“The Keystone pipeline would enhance our energy security and create job opportunities for Americans. Lift these sanctions, prioritizes Russian energy over American energy and Russian jobs over American jobs.”

James Coleman, professor of law at the Southern Methodist University in Dallas said it was “striking that the administration was willing to reward Russia to placate its German ally, but unwilling to budget on Keystone XL.”

Lawrence Herman, a former Canadian diplomat, told the Financial Post it is fair to link Biden’s policy with Nord Stream 2 and Keystone XL, noting that Canada will be materially harmed “if the U.S. fails to stand up and respect its binding obligations” on Keystone XL.

Coleman said “some have joked that Canada is the United States’ strategic oil reserve, which is to say that oil is always there if the United States wants to approve a pipeline later.”

Line 5

While this spat continues, the Line 5 plan to build a tunnel under the Straits of Mackinac in the face of strong opposition from Michigan Gov. Gretchen Whitmer, now faces a new setback with the U.S. Army Corps of Engineers opting to conduct an extensive review of Enbridge’s project.

The USAEC has chosen to prepare an environmental impact statement, a more wide-ranging study than an environmental assessment.

The Army Corp’s website says an impact statement is “the most thorough and comprehensive level of the National Environmental Policy Act documentation used to assist in making a decision.”

An Army Corps permit is needed regardless of the permit issued by the Michigan Department of Environment, Great Lakes and Energy.

That review process is seen by Enbridge as pushing back the timeline for constructing a tunnel to carry 540,000 barrels per day and could take years to complete.

Enbridge said the company has already spent more than US$100 million on the project and “remains intensely focused on project permitting and the sustained and safe operation (of the existing) Line 5,” which has never leaked into the Straits of Mackinac.


Print this story | Email it to an associate.

Petroleum News - Phone: 1-907 522-9469
[email protected] --- ---

This story has 889 words, takes 2 min. to speedread and it is 2145 pixels high.