Trump has known as for revival of deserted Keystone XL pipeline undertaking, ‘get it constructed — NOW!’
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Pure Assets Minister Jonathan Wilkinson says Canada is open to having a dialog about reviving the Keystone XL pipeline undertaking, however not earlier than the specter of sweeping United States tariffs on Canadian items is dropped.
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He mentioned U.S. President Donald Trump’s name for the speedy revival of the cross-border pipeline undertaking earlier this week was “obscure” whereas his authorities is concurrently threatening a ten per cent tariff on Canadian power.
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“These are fairly massively inconsistent,” he mentioned on Thursday. “On the finish of the day, there could also be a dialog about KXL, however it could’t be till the People really resolve that they’re going to down instruments with respect to tariffs.”
Wilkinson identified that the 830,000-barrel-per-day pipeline faltered resulting from regulatory points within the U.S., not from something that was raised on the Canadian facet of the border.
After greater than a decade of efforts and billions spent on the partially constructed pipeline, former proponent TC Vitality Corp. (then TransCanada Corp.) formally deserted the proposal in 2021 after then president Joe Biden revoked its permits. The corporate has since spun off its oil pipeline enterprise into South Bow Corp.
Trump mentioned the corporate behind the deserted proposal, or one other pipeline firm, ought to come again to the U.S. and “get it constructed — NOW!” in a put up on social media Monday.
“We’re actually open to speaking about KXL, however it will want a proponent, which it doesn’t have proper now, and it will want regulatory certainty in the USA,” Wilkinson mentioned.
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Ottawa believes it has answered Trump’s border safety considerations, enacting measures that appear to have been met with approval after he delayed implementing tariffs on Canadian items till March 4.
However a call on whether or not to go forward with tariffs in opposition to Canada remains to be more likely to go right down to the wire, Wilkinson mentioned.
“President Trump form of thrives on misdirection and in creating uncertainty,” he mentioned. “On the finish of the day, we’ll solely discover out if we have now been profitable in convincing the president on the day.”
Wilkinson has been pitching U.S. officers for weeks on a partnership to develop a half-dozen power and significant minerals initiatives aimed toward boosting funding on each side of the border whereas attaining Trump’s said goals of retaining power costs low for People and enhancing nationwide safety.
Essentially the most important oil-related proposal is Enbridge Inc.’s beforehand introduced plan to extend capability on its Mainline system carrying Canadian crude to the U.S. Midwest, Wilkinson mentioned.
And in a press release Friday, Enbridge mentioned as many as a number of hundred thousand barrels per day of extra capability might be introduced onstream as early as 2027 or 2028. The extra egress might come various methods, together with debottlenecking and including horsepower to spice up flows, the corporate mentioned, including that additional particulars will likely be introduced subsequent week.
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On a name final Friday along with his American counterpart, U.S. Vitality Secretary Chris Wright, Wilkinson mentioned he additionally mentioned funding in rising Canada’s uranium manufacturing in Saskatchewan and increasing conversion services in Ontario.
“North America really might have a full nuclear gas cycle that might get rid of the dependence the USA presently has on Russia for enriched uranium,” he mentioned.
Ottawa’s record of potential initiatives to expedite contains proposals to spice up Canadian mining and exports of germanium and gallium to displace provide threatened by China’s export ban to the U.S.
“It might create jobs and alternative in Canada and it will transfer this dialog from a lose-lose to a win-win,” Wilkinson mentioned.
Even when tariffs don’t materialize, Canada is now in a state of affairs the place it will likely be necessary to have a look at lowering the quantity of commerce it does with the U.S., Wilkinson mentioned, resembling actively searching for out clients in international locations resembling Japan, South Korea, Australia and Europe.
For example, Canada’s commerce in pure gasoline is poised to blow up, Wilkinson mentioned, pointing to liquefied pure gasoline export initiatives presently being in-built British Columbia, together with the primary phases of LNG Canada, Woodfibre LNG and Cedar LNG.
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“We’re very near choices being made about LNG Canada Two,” he mentioned. “If all 4 of these initiatives go forward, that quantity of gasoline is about half of what we presently ship to the USA. That’s a big step ahead by way of commerce diversification.”
Canada might additionally pursue a modest increase to crude oil flows on the Trans Mountain pipeline, however Wilkinson warned concerning the threat of “overreacting” to Trump’s threats in the case of initiatives aimed toward increasing crude oil manufacturing.
Regardless of feedback earlier this month calling for dialogue of a brand new west-to-east oil pipeline, he questioned the necessity for an additional new pipeline undertaking underneath the present circumstances.
“I’m undecided what a brand new pipeline would do for you,” he mentioned. “(It) begins with there really being a enterprise case. And I don’t assume you’re more likely to see proponents lining as much as construct a pipeline until they’re positive that they will fill it.”
He mentioned a brand new pipeline to tidewater might not be vital whereas Canadian crude continues to be in excessive demand south of the border due to the configuration of refineries within the Midwest and Gulf Coast optimized to course of Canada’s heavy barrels. Moreover, he pointed to the Worldwide Vitality Company’s prediction that world oil demand will peak within the subsequent 5 years.
In a rejoinder to current requires a paring again of regulatory hurdles for main initiatives and the repeal of federal laws such because the Influence Evaluation Act, Wilkinson defended his authorities’s method to main infrastructure initiatives like pipelines.
“On the finish of the day, attempting to in some way run roughshod over Indigenous considerations and environmental considerations will solely lose you the flexibility to get social licence for any of those initiatives,” he mentioned.
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