The viability of resurrecting the Keystone XL pipeline, which President Joe Biden rejected on his first day in office, has been questioned by energy writer and consultant David Blackmon. Although the administration of former President Donald Trump has hinted at plans to restart the pipeline, Blackmon contends that there are substantial financial, logistical, and legal obstacles that make this improbable.
- The pipeline assets have been sold to a new company, South Bow Energy, which has shifted its focus to other projects.
- TC Energy, the former operator, canceled the project in 2021, removing miles of installed pipeline to repurpose the materials.
- The rights-of-way and permits for Keystone XL are no longer valid, requiring a lengthy process to secure approvals again.
- Blackmon highlights the uncertainty of future political administrations as a key deterrent for investors, making a revival of Keystone XL impractical.
DAVID BLACKMON: A Trump Effort To Revive Keystone XL Would Likely Be Purely Symbolic
President Joe Biden’s decision to cancel the cross-border permit for the Keystone XL pipeline system on his first day in office as a political payoff to his environmentalist campaign funders was possibly the worst of all the disastrous energy-related actions he took during his four years in office.
Biden’s decision to stop the $8 billion project without discovering that operator Trans-Canada (now TC Energy) had broken any US laws or regulations was already problematic enough. His decision was even more concerning because, by January 2021, hundreds of miles of pipe had already been installed, and Trans-Canada had already spent more than $3 billion constructing a large portion of the project.
Even worse are the facts that, in addition to abandoning the project, Biden also eliminated up to 10,000 well-paying American jobs during its construction, increased America’s reliance on oil imports from adversaries like Venezuela and Iran by reducing Canadian imports, and even cost the province of Alberta an estimated $1.3 billion that it would have received from the project’s completion.
The most detrimental effect of Biden’s avaricious act of crony politics, however, was the erosion of confidence in the impartial and consistent enforcement of American laws and regulations. Because investors could no longer presume that U.S. rules would be enforced based on merit rather than political fiat, the cancelation of Keystone XL made it far more difficult for large corporations to obtain finance for large projects that take years to permit and develop. The United States’ long-standing dominance over other regions of the world was seriously undermined.
Major media sites reported in a rush of headlines last week that the Trump transition team was trying to restart the Keystone XL project and was drafting measures to overturn Biden’s poorly thought-out decree. Although that is undoubtedly a noble objective, events since 2021 will probably restrict it to a simply symbolic gesture.
First, the project’s remaining assets and rights are no longer even owned by TC Energy. In June of this year, those assets and the remainder of the Keystone Pipeline system were spun off into a new company called South Bow Energy. When asked about the potential resuscitation of Keystone XL, a representative for that company was hesitant to comment, stating, “As a new company, our focus and priority at this point is to continue to deliver energy safely and efficiently.” Expanding our business is a component of South Bow’s long-term plan.
Second, TC Energy declared that it had canceled the project and would not be attempting to continue the battle a few months following Biden’s devastating conduct. The hundreds of miles of pipe that had already been buried were then taken out by TC Energy in order to be used for other projects after the cancelation.
Third, the Keystone XL project’s rights-of-way are no longer in force. The project’s permits aren’t either. Therefore, reacquiring all those miles of rights-of-way and municipal, state, and federal licenses would require a laborious, years-long procedure, which would be necessary for any attempt by South Bow to resurrect it.
Returning to the most detrimental element of Biden’s political retaliation, any such endeavor would undoubtedly continue into the upcoming 2029 presidential term. Who will be prepared to spend billions of dollars on a pipeline project that may be shelved if voters choose to elect a different Democrat to the presidency in 2028? This is partly due to the policies of Biden and his team.
Therefore, even while the Trump team’s intention to restart Keystone XL is admirable, the reality on the ground suggests that it would most likely only be a symbolic gesture.
The current administration must end quickly.
David Blackmon is a Texas-based energy writer and consultant. He worked in the oil and gas industry for 40 years, specializing in communications and public policy.
The Daily Caller News Foundation’s official stance does not align with the author’s views and opinions, which are expressed in this column.
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