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Layoffs at TransCanada Pipeline company lays off 185 of some 6,000 employees across North America as Keystone XL pipeline, Energy East project delayed Gary Park For Petroleum News
TransCanada has become the first Canadian energy transportation company to take a bite out of its payroll by laying off 185 workers as part of a “shake-up” in its major projects division.
With no end in sight to delays in its Keystone XL pipeline from Alberta and North Dakota to the U.S. Gulf Coast and opposition mounting to its Energy East project from Alberta to Canada’s East Coast, the pipeline power decided it had to act.
TransCanada said the layoffs are not tied to any specific project.
Although the job numbers are small in relation to its payroll of about 6,000 across North America, the cuts have deeper symbolism, involving projects that are worth almost half of TransCanada’s C$46 billion capital growth plan.
Of the 185 workers, 100 are full-time and the rest are contractors, with the bulk of the positions being eliminated in the head office city of Calgary.
The company said the reductions are part of a restructuring that is “designed to ... meet the needs of our customers, while allowing TransCanada to remain competitive and deliver incremental value to our shareholders.”
Energy East has a capacity of 1.1 million barrels per day of oil sands bitumen and conventional crude, some for export from New Brunswick and Quebec, making it North America’s largest crude pipeline at 2,800 miles.
Energy East startup delayed But the scheduled startup date has been delayed by a year to 2020 after the company abandoned plans to build a tanker terminal on the St. Lawrence River because of risks to endangered beluga whales. TransCanada is now weighing its options for a different Quebec site.
The company said that even if it drops plans for a marine terminal in Quebec, that province would derive significant economic benefits from Energy East by connecting two refineries to a safe and reliable supply of western North American crude to replace 600,000 bpd of crude imported from uncertain sources in Nigeria and Venezuela.
“Energy East could deliver much of the oil Quebec’s refineries require while increasing (Canada’s) energy self-sufficiency,” TransCanada said. “The pipeline comes with the added benefit of being safer and more environmentally respectful than any other means of moving large quantities of oil over long distances, including rail.”
Quebec Premier Philippe Couillard continued to question the merits of Energy East in his province, arguing there are no benefits if the pipeline is just a “transit place” for oil sands crude on its way to the East Coast.
Rather than promoting the use of oil sands production, the Canadian government should be “very proactively engaged in climate change” measures by reducing the consumption of fossil fuels, especially in advance of the United States global summit in Paris this December, he said.
Lac-Megantic concerns Couillard also voiced his concerns about crude-by-rail, noting that Quebec has experienced the worst accident in that sector when a runaway train derailed in Lac-Megantic, killing 47 people and leveling the downtown core.
Alberta Energy Minister Margaret McCuaig-Boyd said her government is not daunted by Couillard’s concerns and will work with Quebec and other provinces to overcome the obstacles to Energy East, even though it has dropped lobbying efforts for TransCanada’s Keystone XL and Enbridge’s Northern Gateway.
She said there is a “shared priority” among all provinces to move Alberta’s oil resources to new markets, suggesting that Couillard is mostly “trying to make sure the project is right for his province.”
McCuaig-Boyd said Premier Rachel Notley will advance those efforts when the provincial premiers hold their annual meeting in July, preceded by a meeting of energy ministers.
New Brunswick Premier Brian Gallant - whose province stands to benefit from major expansions of Irving Oil’s refinery complex at Saint John - said those who support Energy East have to “show Quebecers, to show Canadians across the country that there are benefits for all of us.”
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