Demonstrators against the Keystone XL pipeline march in Lincoln, Nebraska, in 2017
March 31, 2022
The Keystone XL pipeline, an additional route for getting Canadian crude to US refineries, has been buffeted by competing national, commercial and environmental interests since it was proposed in 2008.
Environmentalist opposition helped reverse the Obama administration’s initial support for it. Part of the reason that the environmental lobby won was investors’ reluctance to put more money into Alberta tar sands when the oil price was so low and the environmental impact relatively high. The project was revived by the Trump team and then cancelled by President Joe Biden to signal a move away from fossil fuels. Alberta premier Jason Kenney has urged the Biden administration to revive Keystone XL, but this lobbying is unlikely to shift US policy, even as the ban on Russian oil imports dictates reviews of energy thinking elsewhere.
The cancellation is important because of the impact (since sharply reduced) of the left of the Democratic Party had on policy at the start of the Biden administration, rather than any significant damage to the US economy. A degree of Republican support for reviving the project will force Democrats to explain why environmental concerns are still paramount. Yet Biden is unlikely to reopen the project because it would not make a great difference to reducing prices, but would really undermine his climate credentials. Alberta, at the centre of Canada's oil and gas sector, is the major loser.
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