Published: Fri, October 06, 2017
Markets | By Erika Turner

Western premiers 'deeply disappointed' in Energy East pipeline's cancellation

Western premiers 'deeply disappointed' in Energy East pipeline's cancellation

TransCanada said Thursday it would not proceed with the project, which was unveiled in 2013 and would have carried daily an estimated 1.1 million barrels of western crude to refineries in eastern Canada and a port terminal in New Brunswick.

August 23, 2017: In a decision cheered by environmentalists but considered a setback by the oil industry, the National Energy Board says it will allow wider discussion of greenhouse gas emission issues in upcoming hearings for the Energy East Pipeline. "5.pdf">said that it was "extremely disappointed" with the loss of a critical pipeline project.

The Canadian Energy Pipeline Association and others blamed TransCanada's decision on Ottawa's "unclear decision-making process".

But the Canadian Chamber of Commerce called the decision to abandon the multi-billion dollar project a "serious blow to the Canadian economy", as it would have created thousands of jobs.

"Given the positive signals the federal government has sent to TransCanada over the last weeks ... we believe it is clear that TransCanada is not proceeding with its application for the Energy East pipeline because recent changes to world market conditions and the price of oil have negatively impacted the viability of the project", Gallant said.

The decision comes a month after TransCanada asked the National Energy Board (NEB) for a 30-day suspension of its application after the pipeline regulatory body said its review would include emissions.

As Energy East supporters lamented the loss of jobs and revenue, Indigenous opponents, environmental activists and a number of Quebec politicians celebrated.

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"In light of the project's inability to reach a regulatory decision, no recoveries of costs from third parties are expected".

The pipeline's importance has somewhat diminished for TransCanada since the United States this year approved Keystone XL pipeline, which would run from Alberta to USA refineries, but supporters said they were "extremely disappointed" by the decision. He also rejected criticism that the changes to the rules of assessment of the pipeline project have precipitated the abandonment of the project. "Our government understands that deliberation on upstream emissions and land-use integrity is important and must continue".

Notley suggested more clarity is needed going forward.

TransCanada warned then that the project could ultimately be cancelled.

"We cautioned a couple years ago the inactivity in itself was a decision".

"Social acceptability is a key component of any project", he said. She said the company has committed itself to $24-billion worth of investments in North America, and those investments will now be made by a Canadian company in the USA and Mexico. Instead, the cancellation makes the domestic industry more reliant on the U.S.to act as its broker in getting crude to world markets, he said. "We can get a pipeline approved to service USA refineries, not Canadian refineries, with our own resource".

"Number 1 is actually pretty legit, which is TransCanada now has to go full bore on Keystone XL", he said. "It is also not the only opportunity the government is pursuing for the Saint John region". We'll get through this.

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