TransCanada CEO 'optimistic' about KXL

TransCanada Corp.'s Chief Executive said yesterday that he remains "very optimistic" that the Keystone XL pipeline will get built, but he isn't sure when it will happen.

Russ Girling made the remarks during a panel session at a major economic conference in Montreal. He told reporters later that the cost of the project will be "materially more" than the current US$ 5.4 billion estimate.

The much-debated pipeline project

The controversial project has been under review by the US State Department –which has jurisdiction because it crosses the Canadian-US border – for almost six years. Earlier this year, the department indefinitely extended the review, citing ongoing litigation over a Nebraska law that allowed the pipeline's route through the state. That move means a decision is likely delayed until after the November midterm elections in the US.

Canada's Conservative government, which is pushing to diversify export markets for the country's energy products, has been lobbying hard to get Keystone XL approved. It says the project will create jobs on both sides of the border and strengthen Canada's economy. But the planned pipeline has drawn heavy criticism from opponents, including environmentalists, who say it will lead to greater development of, and reliance on, energy sources with high greenhouse-gas emissions. Opponents also warn it could lead to oil spills.

Time and costs

Mr. Girling said he hasn't yet pushed back the expected start for the project as he remains hopeful for a US decision this year. The 1700 mile long pipeline, which would take more than 700,000 barrels of crude from Canada's oil sands to Gulf Coast refineries, would take about two years to construct, he said.

"The costs will be far more expensive than they were," but "there's no sense announcing new costs until we actually know when we're going to start construction," he said.

At the panel session, Mr. Girling took issue with the view that not allowing the project to proceed would halt the movement of oil from Canada's landlocked oil sands. He said that is "simply not the case" because it would be transported by rail.

Security report

In related news, a former Navy SEAL chief named David Cooper was hired by the nonprofit group NextGen Climate to determine how vulnerable the controversial final leg of the Keystone pipeline network might be to terrorism.

In a 14 page report, Cooper determined that it would be “easy to execute a catastrophic attack” on the fourth segment of the pipeline system, based on a mock attack he carried out on the completed Keystone I, or Gulf Coast Pipeline, which came online in January.

He went on to describe multiple scenarios for spills ranging from 1.02 to 7.24 million gallons of diluted bitumen, the viscous, toxic, low quality oil derived from Alberta’s oilsands.

In his report, Cooper asks if government officials and Keystone pipeline operator TransCanada have run drills for a co-ordinated response to sabotage. Through its press officer, Ross Feinstein, the TSA says the agency reviews such matters in office meetings and that a fuller response to such an act of terror lies outside its jurisdiction: “Under TSA’s Intermodal Security Training & Exercise Program (I-STEP), TSA conducts tabletops with pipeline operators to exercise their security plans and to strengthen working relationships among the industry and government partners. All of TSA’s I-STEP exercises with pipeline operators have been focused on critical infrastructure protection and preventing security incidents—not emergency response or recovery from an act of sabotage. Responsibility for an act of pipeline sabotage would be the FBI’s for the investigation and DOT’s Office of Pipeline Safety for the repair and restoration of the pipeline.”

Assessments

Cooper also suggested that the public would be well-served if the TSA and pipeline operator completed safety and security assessments of its own.

In April 2010, the TSA testified before Congress that “joint US-Canadian teams have reviewed six of the largest pipeline systems, or approximately 25% of the total cross-border systems.” Did these include any segments of the Keystone network? No. ”TransCanada’s Keystone network was not operational when TSA was still doing cross border pipeline assessments and has not been assessed as part of this programme. The last cross border pipeline assessment was in 2008.”

Some observers have responded to Cooper’s report by dismissing it as a PR stunt (which it most definitely is) or suggesting that the former commando’s focus on the Keystone XL is misplaced because there are thousands of miles of unpatrolled pipelines in North America. In an interview, Cooper readily acknowledged that the threat he observed was not unique to the completed Keystone I. He also said he understood that he’d be fueling a highly political debate.

Edited from various sources by Elizabeth Corner

Read the article online at: https://www.worldpipelines.com/business-news/11062014/transcanada_ceo_optimistic_about_kxl/