Keystone XL Pipeline

Keystone XL is a 1,947 km long pipeline project that will carry crude oil from Alberta to Nebraska. It is owned by Calgary-based TC Energy. The pipeline is named XL for “export limited.” First proposed in July 2008, it is the fourth phase of TC Energy’s existing Keystone Pipeline system. Keystone XL has federal approval on both sides of the Canada-US border. It has nevertheless faced significant opposition and legal challenges on environmental grounds. In March 2020, TC Energy announced that it will start building the pipeline, backed by an investment from the Alberta government.

Keystone XL is a 1,947 km long pipeline project that will carry crude oil from Alberta to Nebraska. It is owned by Calgary-based TC Energy. The pipeline is named XL for “export limited.” First proposed in July 2008, it is the fourth phase of TC Energy’s existing Keystone Pipeline system. Keystone XL has federal approval on both sides of the Canada-US border. It has nevertheless faced significant opposition and legal challenges on environmental grounds. In March 2020, TC Energy announced that it will start building the pipeline, backed by an investment from the Alberta government.


TC Energy's Keystone XL pipeline (proposed)

Project Details

The Keystone Pipeline currently ships up to 591,000 barrels of crude oil per day. It carries this oil from Alberta to refineries in Illinois and Texas. Keystone XL will increase the system’s capacity to 830,000 barrels of oil per day. It will cross the Canada-US border en route from Hardisty, Alberta to Steele City, Nebraska. The Alberta portion will run 259 km.

The Alberta government says that construction will create more than 15,000 direct and indirect jobs in Canada. This includes 1,400 direct and 5,400 indirect jobs in Alberta. Proponents also cite revenue to Canada from property taxes and say that XL will add US$3.4 billion to the United States’ GDP.

Opposition

Environmental groups, ranchers, and Indigenous communities in Alberta, Montana and Nebraska have opposed the project. Many fear the additional crude oil shipped by the pipeline could pollute lands and rivers. In the context of the Keystone XL debate, climatologist James Hansen said in 2012 that if Canada’s oil reserves were fully tapped, the resulting carbon emissions would mean “game over for the climate.”

Because Keystone crosses the Canada-US border, the XL project needed US State Department approval. President Barack Obama rejected Keystone XL’s permit in 2015. He said that approving the project would have undercut his country’s leadership on climate change.

Permits from President Trump

In March 2017, US president Donald Trump issued a permit approving the project. TC Energy began seeking the various other permits and approvals needed to begin construction. In November 2018, however, a federal judge in Montana stopped the project with an injunction. The judge ordered the State Department to complete a more thorough environmental assessment before work could continue. President Trump issued a new permit in March 2019. Several months later, an appeals court lifted the Montana judge’s injunction. This cleared the way for construction in the US.

Current Status

TC Energy announced in March 2020 that it was ready to begin construction. To speed up this work, the Alberta government promised an equity investment of $1.5 billion in Keystone XL. Alberta will also guarantee a $6 billion loan for construction. Keystone XL is expected to be in service in 2023.


Key Terms: Keystone XL Pipeline

Crude oil (or petroleum)

Unrefined hydrocarbon oil that is extracted from the earth to process for various human uses.

Gross domestic product

The total value of goods and services produced in a country during a specific time period. The figure is often used as a measure of a nation’s economic health.

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