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Energy East cancellation leaves Rachel Notley 'deeply disappointed'

Edmonton Journal logo Edmonton Journal 2017-10-05 Emma Graney
BC-Notley-20161206.jpeg:   © DARRYL DYCK  

Alberta Premier Rachel Notley says TransCanada’s decision to pull the plug on the Energy East pipeline is “unfortunate.”

TransCanada President and Chief Executive Officer Russ Girling delivered the company’s verdict on the project in a statement released Thursday morning.

The energy company has also canned its Eastern Mainline project.

Notley said although the decision was driven by a broad range of factors, it was an “unfortunate outcome for Canadians.” 

Notley said the project would have been a nation-building project benefiting all of Canada through new jobs, investment, energy security and replacing imported oil brought from the U.S. and elsewhere.

The news wasn’t quite a bolt from the blue.

The company suspended its application on Sep. 7  for 30 days on the $15.7-billion route that would carry Alberta oilsands product from Hardisty to Saint John. The move came after the National Energy Board said its review would now consider indirect greenhouse gas emissions.

TransCanada warned then that the project could ultimately be cancelled.

On Thursday, Notley called on the NEB to explain what future project reviews will look like in Canada.

Deliberation on upstream emissions and land-use integrity is important, Notley said, but “investors need confidence.”

“We look forward to seeing that certainty in place soon,” she said. 

United Conservative Party leadership hopeful Brian Jean blasted the decision, calling it an “attack on Alberta.”

He demanded Notley use every legal tool available to challenge the federal government’s NEB reforms in court. 

Jean, one of two UCP MLAs in the oil heartland of Fort McMurray, also pointed his finger at Notley and the provincial government.  

“The NDP promised massive carbon taxes and caps on our oilsands would mean social licence and approval for our pipelines, but they have been proven wrong yet again,” he said in a statement Thursday morning.

Jean said other provinces have “declared war on Alberta” over pipelines.

“They are cheering for Canada to fail and threatening national unity,” he said.

“The political blockading of Canada’s energy products is not acceptable and must be fought every step of the way.”

As a result of the decision, TransCanada expects an estimated $1 billion after-tax, non-cash charge to be recorded in the fourth quarter, the company said Thursday. Because regulators failed to reach a decision on the project, TransCanada expects “no recoveries of costs from third parties.”

Notley said the decision highlights the importance of diversifying market access and making the TransMountain expansion a national priority. 

Energy producers in Alberta had hoped the TransCanada projects would help them diversify their markets, with most of the existing pipeline network linking the energy-rich province to the U.S. Midwest and Gulf Coast.

Energy East would have carried about 1.1 million barrels of oil a day from Alberta and Saskatchewan to eastern Canadian refineries and a marine terminal in New Brunswick, on Canada’s Atlantic Coast.

The Eastern Mainline project would add new gas pipeline and compression facilities to an existing system in Southern Ontario, where most of the country’s home and industrial gas consumers are located.

With files from Bloomberg and The Canadian Press


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