:Western news

June 15, 2021

Western Canada: Keystone XL’s death leaves Alberta on the hook – and looking for another fight

Danny Johnston/The Associated Press

Western Canada: Keystone XL’s death leaves Alberta on the hook – and looking for another fight

Wendy Cox and James Keller

Good morning. It’s James Keller in Calgary.
TC Energy’s decision this week to terminate the Keystone XL pipeline was hardly a surprise.
Joe Biden’s win in last year’s U.S. presidential election, after campaigning to kill the project, still left some holding out faint hope he could be convinced to change course. But his inauguration-day executive order pulling the pipeline’s cross-border permit seemed to leave no path to revive the project, which would have provided a much-needed direct route for Alberta crude.
The Calgary-based company said it made the decision after a comprehensive review of its options. TC clearly determined there were none left, and will instead focus on safely winding up the project.
The reaction from the business community was muted, given the apparent preordained nature of the decision, and while TC’s stock price dropped the day after the cancellation, it has already rebounded to above where it started.
The response in Alberta, however, was more aggressive. The province has long held up Keystone XL as key to Alberta’s oil sector, which has struggled for years in the face of constrained pipeline capacity and low prices. And it’s not the first pipeline to fail, instead joining a list that includes Enbridge’s Northern Gateway and TC’s Energy East pipelines.
Worse for Alberta is that the government invested more than $1-billion last year when it appeared TC Energy was prepared to walk away after struggling to find private investment. The province expects the cancellation will leave it on the hook for $1.3-billion.
Mr. Kenney has said repeatedly that his government would use legal challenges to recoup its losses from the United States, namely by filing a lawsuit under the North American free-trade agreement’s Chapter 11 provisions, which remain in effect.
This week, the Premier said that’s still on the table and the government is talking to TC Energy about strategy. The company, however, has not publicly said what it’s prepared to do or if it is even interested in legal action.
Experts have said Alberta likely wouldn’t have standing on its own and would need TC Energy to join such a case. But experts have cast doubt on whether there’s much of a case under NAFTA.
The fact that the pipeline was approved by former president Donald Trump with an executive order, rather than through traditional regulatory channels, is unusual and probably would hurt a legal claim, Kristen van de Biezenbos, an associate professor at the University of Calgary’s law school who specializes in energy law, told me.
That’s because presidents have unfettered power to issue, or revoke, executive orders. And because no other pipeline has ever been approved through executive order, there’s no comparable projects for TC to point to in order to show the company was treated unfairly in comparison.
Mr. Kenney also said the province intends to intervene in a lawsuit filed by 23 Republican-led states challenging Mr. Biden’s executive order.
The Globe’s Jeffrey Jones writes that Keystone XL’s cancellation came on a day of demarcation for Canadian energy. As TC was terminating its pipeline, the five largest oil-sands producers announced plans to achieve net-zero CO2 emissions by 2050.
“The very fact that the companies in a sector responsible for 11 per cent of Canada’s emissions are beginning a process that, one assumes, can be tracked and analyzed shows they are no longer counting on a future of unlimited growth as envisioned when Keystone XL was devised and debated.”
David Berman writes that TC Energy will do just fine without Keystone: “TC Energy’s announcement on Wednesday that it had cancelled the project was really just a formal declaration that observers knew was coming – analysts adjusted their targets for the stock price back in January – which was why the share price barely moved on the news.”
This is the weekly Western Canada newsletter written by B.C. Editor Wendy Cox and Alberta Bureau Chief James Keller. If you’re reading this on the web, or it was forwarded to you from someone else, you can sign up for it and all Globe newsletters here.
British Columbia
Victoria cancels Canada Day celebrations as Mayor says they would be damaging to reconciliation efforts

Frances Bula

British Columbia’s capital city has cancelled Canada Day celebrations after the Mayor and council concluded marking the day would be damaging to Victoria’s efforts at reconciliation.
Mayor Lisa Helps presented city council with a motion earlier this week noting that longstanding Lekwungen participants had said they would not take part as usual after the announcement by the Tk’emlúps te Secwépemc First Nation of the discovery of 215 unmarked graves at the site of a former residential school in Kamloops. The chiefs of the Songhees and Esquimalt supported that direction, she said.
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Squamish Nation calls on B.C. to halt old-growth logging in traditional territories

Jen Osborne /The Canadian Press

  Squamish Nation calls on B.C. to halt old-growth logging in traditional territories

Justine Hunter

The Squamish Nation wants British Columbia to halt old-growth logging in their traditional territories, giving notice it will oppose 20 proposed forestry cutblocks around Howe Sound, north of Vancouver, where they say ancient forests are at risk.
The decision, voted on by Squamish Nation council on Thursday, was made just one day after British Columbia Premier John Horgan approved deferrals at the request of local Indigenous communities to suspend old-growth logging in the Fairy Creek watershed and in the nearby Central Walbran.
“We’re asking the government to support Squamish management of our lands and resources that rightfully belong to us,” Khelsilem, an elected member of the council, said in an interview. “The government is infringing on our rights by allowing these sites to be logged without our permission and without our consent.”
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Calgary hospital has 22 cases linked to Delta COVID-19 variant, including 10 fully vaccinated

Alessia Passafiume

Two COVID-19 outbreaks at a Calgary hospital linked to the more-contagious Delta variant of the virus have grown to 22 people, including 10 who were fully vaccinated.
Kerry Williamson, executive director of communications for Alberta Health Services, or AHS, said the majority of cases in two units of the Foothills Medical Centre are mild. There are another 11 cases in a third unit, though that has not been associated with the variant. Overall, two patients, including one of the cases involving the Delta variant, have required intensive care.
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Lawyers for convicted serial rapist Matthew McKnight seek new trial over Crown’s ‘abusive’ conduct

JASON FRANSON/The Canadian Press

  Lawyers for convicted serial rapist Matthew McKnight seek new trial over Crown’s ‘abusive’ conduct

Jana G. Pruden

Lawyers for convicted serial rapist Matthew McKnight say his five sexual-assault convictions should be set aside, and a new trial ordered on those charges, because the Crown prosecutor was “abusive” to Mr. McKnight in court and failed to act “in an even-handed way” with him during the trial.
“The Crown’s misconduct in this case jeopardized the appellant’s right to a fair trial and caused a miscarriage of justice,” reads the appeal factum filed by Edmonton law professor Peter Sankoff, who is working with Mr. McKnight’s trial lawyer, Dino Bottos.
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First harm reduction site opens in Regina
Canada’s first legal supervised consumption site opened in Vancouver in 2003, but it would take 18 years and more than 1,000 drug-related deaths in Saskatchewan before similar support would become available in the province’s capital.
“This is based on the premise of harm reduction,” said Michael Parker, executive director of Regina’s Nwo Ytina Friendship Centre, which houses the site that opened last month. “To say, ‘No, no, you shouldn’t do that’ doesn’t change it (drug use).
“To create a safe space for people to use with medical supervision means that they’re more likely to be able to access other supports and services when they’re ready.
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Manitoba launches vaccine lottery to offer incentives to get a shot, offering $2-million in prizes

JOHN WOODS/The Canadian Press

Manitoba launches vaccine lottery to offer incentives to get a shot, offering $2-million in prizes

Alessia Passafiume and Andrea Woo

Manitoba plans to hold a lottery that will hand out $2-million in cash and scholarships to entice people to get vaccinated against COVID-19, becoming the first province in Canada to offer incentives to boost slowing demand for the shots.
Several America states have turned to lotteries to push up vaccination rates. Other provinces, including Alberta and Quebec, have said they are considering whether to offer their own incentives. Health officials and experts have warned that demand is expected to drop off now that the most eager and easiest-to-reach people have received their shots, with some provinces, including Manitoba, confirming that this is already happening.
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  Keystone XL is dead, but for investors, TC Energy will be fine

David Berman

Investment Reporter
For all the handwringing over the cancellation of the Keystone XL project and what the loss of the pipeline extension means for Canada’s energy exports to the United States, spare a thought for investors who have stuck with TC Energy Corp. this year.
Oh wait – these investors are up nearly 26 per cent in 2021, trouncing the benchmark. And the return doesn’t include the hefty dividend that currently yields 5.4 per cent annually.
Perhaps the takeaway here is that TC Energy can fare just fine without Keystone, and it’s best to tune out most regulatory hurdles and political noise.
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Air Products plans $1.3-billion hydrogen plant in Alberta as oil and gas industry seeks net-zero emissions

Jason Franson/The Canadian Press

  Air Products plans $1.3-billion hydrogen plant in Alberta as oil and gas industry seeks net-zero emissions

Brent Jang, Kelly Cryderman and Jeffrey Jones

Alberta’s oil and gas industry, with funding from both Ottawa and the provincial government, has introduced significant new plans for lowering the province’s substantial industrial emissions while greening its image.
Air Products and Chemicals Inc. said Wednesday that it plans to build a $1.3-billion facility in Edmonton that will produce hydrogen derived from natural gas, with a goal of opening in 2024. The company has signed a memorandum of understanding for construction. The agreement is still subject to further negotiations for incentives from the Alberta and federal governments, including $15-million through the province’s emissions reduction fund.
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Seeking greener pastures: The pandemic is spurring a millennial back-to-the-land movement


Seeking greener pastures: The pandemic is spurring a millennial back-to-the-land movement

Fiona McGlynn

Fiona McGlynn lives in northern B.C.
2020 was the year we obsessively refreshed rental and real estate listings as cottage-country prices soared, wondering if we could afford a piece of sanctuary. Something in our collective consciousness has flipped and we’re headed for the hills – even if the closest we can get is a potted basil plant on a high-rise windowsill.
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  The end of Keystone can be the beginning of renewal for Alberta

Jeffrey Jones

Whether by coincidence or design, it was a day of demarcation for energy in Canada.
Wednesday marked the end of the odyssey that was Keystone XL, a pipeline proposal born from expectations of limitless demand for Alberta’s oil sands-derived crude. Seeing no path forward after more than a dozen years of studies, approvals, rejections, protests, bilateral spats and court battles, TC Energy Corp. formally threw in the towel.
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