The Future of the Keystone Pipeline

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The election of Joseph R. Biden in early November will return to the normal diplomatic and economic relationship between Canada and the United States from the “America First” policy implemented during the Trump administration. A consequence of this is the potential suspension of the Keystone Pipeline project that was green-lighted under the Trump administration. For Canada, that is a $10 billion deal.

The "Keystone" project was initiated by the Canadian energy company TransCanada3. It planned to lay an oil pipeline across the Midwest of the United States to transport oil from Alberta, Canada to a refinery in Texas2. After the Keystone project is completed, 830,000 barrels of crude oil, worth nearly $50 million, will be shipped from Alberta to Nebraska2. The project is about 3000 kilometers long and was divided into four phases of construction. The first three stages were relatively smooth and had been finished by 2014. The fourth stage was considered the most controversial. In order to increase the volume of crude oil transportation with the shortest distance, the Keystone project planned to pass through the Sand Hills area of Nebraska2.

The American people have mixed opinions on the Keystone project. Supporters believe that the Keystone project can not only create jobs but also ensure the security of the U.S. energy supply, thereby reducing oil prices and promoting economic development. Opponents believe that the construction of the Keystone project itself will have an adverse impact on the environment in the sensitive area of Nebraska4. In addition, once the project is completed, it will increase America’s dependence on oil and emit more greenhouse gases, opposing the worldwide trend of developing clean energy. At that time, the environmentalist movement in the United States was in full swing, and the Keystone project hit the muzzle. Many non-governmental environmental protection organizations often go to the White House to protest, and many celebrities also use their influence to raise funds and subsidize lobbying to prevent project construction4. Then-President Barack Obama hesitated several times before delaying the Keystone Pipeline project in November 20151.

However, in January 2017, President Trump overturned Obama's decision and restarted the Keystone Pipeline project, following on his "Economy First" policies1. He does not consider being responsible for global environmental protection but instead wants to promote the development of the U.S. economy with the Keystone project, with reports of the potential 28,000 jobs created by the project1. Now that Biden has won the election, the fate of the Keystone project has reached a turning point. Like Obama, Biden prefers clean energy and once declared during the election campaign that he would close the Keystone project.

Canada has 175 billion barrels of oil reserves, second only to Saudi Arabia and Venezuela. However, most of Canada’s oil reserves are oil sands, which are difficult to refine, consume more water and fuel, and emit more greenhouse gases4. In order to promote oil sands, Canadian oil companies invested heavily in lobbying government agencies and successfully changed the description of oil sands in mainstream media in the United States and Canada from “tar oil” to “oil sands” to reduce public disgust4. The Keystone project is exactly the product of Canadian companies’ promotion of oil. Once completed, Canadian oil can be poured into the United States, obtaining huge economic benefits. Canadians also believe that the Keystone project can also help build close relations with the United States, and thus is of great political and strategic significance. Affected by the COVID-19 pandemic, the entire oil industry is in a cold winter. Canada’s oil industry has also been hit hard as it has suffered from the biggest impact in 40 years. Once the Keystone project is halted, Canada's oil industry will suffer another major blow.






More posts by Constantine Li.
The Future of the Keystone Pipeline
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