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Energy East pipeline likely delayed for at least ten years

A protest against the Energy East pipeline in Regina, September 2016.

The Council of Canadians has vocally opposed the 1.1 million barrel per day TransCanada Energy East pipeline for years.

Now, CBC reports, “With the stroke of a pen [on January 24], Trump made it official: he wants to approve the Keystone XL pipeline, another project proposed by the same builder, TransCanada Corp. And that could make Energy East one pipeline too many for another decade or more, according to one forecast. Trump’s move ‘delays the time pressure to build Energy East’ for a decade, says Trevor Tombe, an economist at the University of Calgary who studies energy, environment and trade.”

The article adds, “The oil industry’s [2015] projected growth in supply of western Canadian oil through 2040 [forecasts] two million more barrels.” That will be enough to fill the 890,000 barrel per day Kinder Morgan Trans Mountain pipeline, the 760,000 barrel per day Enbridge Line 3 pipeline and the 830,000 barrel per day Keystone XL meaning Energy East wouldn’t be needed until around 2040.

TransCanada would also not likely to be able to finance both pipelines. The Keystone XL pipeline is estimated to cost about $5.4 billion to build, while Energy East is the more expensive project at $15.7 billion.

Significantly, Wood Mackenzie analyst Afolabi Ogunnaike says, “At best, we would expect TransCanada to build Keystone XL or Energy East, but not both.” Calgary-based Stream Asset Management chief market strategist Dan Tsubouchi adds, “The need for Energy East isn’t there right now.”

And BNN reports, “The odds of ever actually building Energy East are dramatically lower today than they were barely 24 hours ago. The odds of building Keystone XL, during the same timeframe, went from zero to near-certain.”

Adding to this, the National Energy Board announced today that any prior review process on Energy East has now been voided. That likely means further delays for the application process to be restarted, for the list of issues to be determined, for intervenors to be confirmed, and for the hearings to begin again.

The Council of Canadians congratulates Transition Initiative Kenora and Ecojustice for their challenge that led to this decision.

If the NEB process moves forward, the federal government wouldn’t likely make its decision until some point in 2020 (which is when the pipeline was originally scheduled to be in operation).

The Council of Canadians will keep watch on Energy East but now intensify its efforts to stop the Trans Mountain, Line 3 and Keystone XL pipelines.

All these pipelines mean a continued expansion of the tar sands, all cross waterways and sources of drinking water, and all cross Indigenous lands and territories without adequate consultation and consent. We believe the Trudeau government has not demonstrated “climate leadership” by approving 2.48 million barrels per day of export capacity with these three pipelines.