Fort McMurray, Alberta, one of Canada’s largest oil production hubs, located near the Athabasca Oil Sands
On November 6, U.S. President Barack Obama confirmed Washington’s worst-kept secret, and Canadian oil companies’ biggest fear: the U.S. Department of State would reject TransCanada Corporation’s application to construct the fourth phase of their transcontinental pipeline. Environmentalists in both Canada and the U.S., as well as the American left at large, rejoiced at the news. That’s a misguided reaction.
For starters, the rejection of the Keystone XL project does not mean that Canadian oil companies will simply shut down. Nor will they cease to harvest from the Alberta oil sands. They will simply resort to other methods of distribution – namely trains and tanker trucks – which, it should be noted, pose a significantly greater risk of oil spills than pipelines.
Another aspect of the Keystone debate often ignored by both the American and Canadian media is that the pipeline already exists. Phases 1 through 3 of the pipeline run from Hardisty, Alberta through the Canadian prairie provinces, before dipping into North Dakota and running south to distribution centres in Illinois and Oklahoma. Phase 4 (the rejected project) would have shortcutted the long journey across western Canada by cutting diagonally across the Midwestern United States. The pipeline would have also extended to Houston in order to ease distribution to overseas vendors. The rejection of the project’s fourth phase won’t stop Canadian oil from flowing into the United States. It already does. All the rejection means is that the oil will not have a safe method of transit to ports, as transportation will continue to rely on trains and trucks.
With this in mind, it is clear that the environmental argument against Keystone XL makes the naive assumption that oil does not play an outsize role in global economics or politics. The U.S. government is completely aware of this, but the vast majority of the Democratic Party’s base is not. With a competitive race for the White House looming large, the Obama administration made the tactical decision to play to its constituent base. Hillary Clinton and her lagging challengers for the Democratic nomination all steadfastly oppose the Keystone proposal.
A Republican win in 2016 could potentially reopen the question of the pipeline. TransCanada Corporation has certainly indicated it intends to re-apply in the future, especially if the White House gets a new, more oil-friendly occupant next year, but they may have trouble securing an eager ally in Ottawa. It remains to be seen how genuinely the project interests the new Trudeau government. Though the Liberal Party has long been in favour of the proposed Keystone XL project, the issue is far from the most important political issue for the average Canadian voter. Now that the project has been rejected once, it’s likely that the new Canadian government will avoid pursuing such a volatile discussion with their biggest trading partner any further. This rings especially true in light of other measures Canada’s new Liberal government plans to take – namely, withdrawing from coalition airstrikes in Iraq and Syria – that could significantly grate on relations with Washington.
One thing is certain – the political leadership in both Canada and the United States agrees that oil is an energy source of decades past, and that the world must move quickly to adopt new, renewable, cleaner sources of energy as soon as possible. But that conviction won’t wish away the massive importance that petroleum continues to play in the global economic order at this moment in time. Even as economies hopefully turn away from oil towards clean energy, it is important we make sure that oil is still transported as safely and cleanly as possible. By rejecting the fourth phase of TransCanada Corp.’s Keystone XL project, the State Department has proven that it values winning ballots over implementing good international policy.
Disclosure: Benson Cook has formerly done partisan work for the Liberal Party of Canada, which supports the construction of Phase 4 of TransCanada Corporation’s Keystone XL Pipeline and currently forms the Government of Canada.
Benson Cook is a first-year student at McGill University, studying Political Science.
Image Attribution: “Fort McMurray, Alberta – Operation Arctic Shadow” by Kris Krüg, licensed under CC BY-NC-ND 2.0