But if elected to a second term, Mr. Obama would no doubt attempt to reinvigorate his administration’s climate-change policy, which could also prompt Ottawa to toughen its own approach to climate regulation.
Texas Gulf Coast access
The energy industry was sideswiped in 2011 when the Obama administration delayed making a decision on Keystone XL. Most observers expected that announcement to come shortly after election day.
They may be in for another surprise.
Republicans passed a bill in the week leading up to Christmas that forces Mr. Obama to make a decision in early 2012, even though the new round of environmental reviews in Nebraska may not be completed by then. With the lure of tens of thousands of jobs, a secure supply of crude from an ally, as well as demand, the industry is confident their arguments will trump environmental dissent.
“It remains very difficult to foresee an eventuality where it does not get approved,” David Collyer, the president of the Canadian Association of Petroleum Producers, said before the Republicans passed the bill forcing Mr. Obama’s hand.
Further, some experts predict Mr. Obama will find a way to put off the decision without quashing the project. TransCanada may start construction on the portion connecting Oklahoma to Texas, for instance.
Expect to hear more about how Keystone XL will benefit American oil producers, rather than solely focusing on Canada’s friendly relationship with the U.S.
West Coast access
Pipelines, once a boring and predictable corner of Canada’s corporate world, will continue to make noise in 2012. With Keystone XL in limbo stateside, the debate will escalate over two proposed routes to Canada’s West Coast from the oil sands.
Ottawa supports westward pipelines, such as Enbridge Inc.’s ENB-T Northern Gateway, and wants them built as quickly as possible. The Joint Review Panel kicks off its hearings in January, and with roughly 4,000 intervenors wanting a say, it could be a tedious haul.
“We have to be realistic – that is going to be a difficult hearing process for the project proponent, Enbridge,” said David Collyer, the president of the Canadian Association of Petroleum Producers, said.
First Nations wield immense power here – Enbridge’s quest will be infinitely easier if it can sway them in favour of the pipeline. But many First Nations are adamant that they will not back down. A constitutional battle over land rights could eventually unfold, some legal experts believe.
Kinder Morgan Inc.’s Trans Mountain pipeline to British Columbia’s tidewaters may have an easier ride since it’s an expansion of an existing line.
Liquefied natural gas exports
Natural gas prices NG-FT in North America are stuck in the gutter, which isn’t likely to change any time soon.
Instead, companies are looking west, hoping to ship liquefied natural gas to Asia to take advantage of higher prices abroad while reducing the glut at home. EnCana Corp. and other major producers are set to build export facilities in British Columbia, with a handful of projects in the works – even though the necessary infrastructure, including cross-provincial pipelines, doesn’t yet exist.
