Do good things come to those who wait? TransCanada is about to find out.
Promises made by then-candidate Trump are now being delivered by the newly elected president and it is welcome news to TransCanada, the firm that’s been working since 2010 to complete the Keystone XL Pipeline. After waiting interminably for the Obama Administration to make a decision, only to be stalemated in 2015, TransCanada has new optimism after President Trump issued an executive order within days of his inauguration intended to expedite “high priority infrastructure projects.”
TransCanada responded immediately: “We appreciate the President of the United States inviting us to re-apply for KXL. We are currently preparing the application and intend to do so. KXL creates thousands of well-paying construction jobs and would generate tens of millions of dollars in annual property taxes to counties along the route as well as more than $3 billion to the U.S. GDP. With best-in-class technology and construction techniques that protect waterways and other sensitive environmental resources, KXL represents the safest, most environmentally sound way to connect the American economy to an abundant energy resource.”
However, it’s not quite a slam-dunk. Bloomberg reported that “Trump stopped short of green lighting construction on either pipeline but put a deadline on the government’s review of TransCanada Corp.’s proposed Keystone XL to transport Alberta oil sands crude to U.S. refineries. “
And there’s a legitimate argument from Energy Consultant Paul Michael Wihbey of Connect Global Strategies, who says the importance of the pipeline has diminished greatly in recent years, as U.S. Gulf Coast refineries are switching to process light Bakken crude and may not have capacity for the heavy oil Keystone would carry from Alberta.
He adds that the project’s rationale could be hurt by any requirement that only U.S. goods and services are used for construction, or a border tax on energy exports, Wihbey says.
Nonetheless, it’s difficult to argue the fundamental benefit of TransCanada’s billions in private investment: quality U.S. jobs; enhanced energy infrastructure; increased global supply & downward pressure on fuel prices benefitting consumers. And north of the border some say XL may be even more impactful for Canada’s GDP.
Looks like a net gain all around especially when you remember XL’s key phrase above: ‘private investment.’