Jim Mone
FILE - In this June 29, 2018, file photo, pipeline used to carry crude oil is shown at the Superior, Wis., terminal of Enbridge Energy. The sponsor of the Keystone XL crude oil pipeline says it's pulling the plug on the contentious project, Wednesday, June 9, 2021, after Canadian officials failed to persuade the Biden administration to reverse its cancellation of the company's permit. (AP Photo/Jim Mone, File)
TC Energy Corp.’s Keystone XL crude pipeline could be built by the first quarter of next year if the Biden administration were to reverse its decision to cancel the project.
Construction of the controversial pipeline, which would have raised Canada’s oil-sands export capacity to the U.S. by almost 900,000 barrels a day, had already begun when the project was scrapped last year by the U.S., Alberta Premier Jason Kenney said during a news conference. U.S. President Joe Biden canceled a key permit for Keystone XL on his first day in office, citing environmental concerns.
“We could turn this around in less than a year,” Kenney said on Monday.
Kenney’s comments come as crude prices surged to almost $140 a barrel after the U.S. said it was looking at a potential ban on Russian oil imports. Keystone XL has been controversial since it was proposed more than a decade ago because it would allow production to grow in carbon-intensive oil sands.
AP Photo/Alik Keplicz, File
FILE - This June 9, 2015 file photo shows then-Canadian Defence Minister Jason Kenney in Warsaw, Poland. He is now the premier of Alberta.
The U.S. government has been reaching out to major oil producers including Venezuela, which is under sanctions, to find replacements for Russian oil after that country’s invasion of Ukraine. It has also been working to restore a nuclear pact with Iran that would allow that country’s oil to return to the market. The U.S. would be better off turning to its northern neighbor for crude than seeking out “dictator oil,” Kenney said.
“The Keystone XL Pipeline Project was terminated in June 2021,” TC Energy said in an email. The existing Keystone pipeline system, which was built before the XL expansion was proposed, “will continue to provide unique, stable and safe source of energy to meet increasing U.S. energy demands.”
The U.S. government would first need to financially “de-risk” the project before TC Energy would commit money to building the line after two previous cancellations, Kenney said. The project was terminated by U.S. President Barack Obama only to be revived by his successor Donald Trump before Biden killed the project again.
“During a disaster like this, national security and the interest of the economy must prevail,” the premier said. “I think there is a lot of creative ways that this could be addressed.”
Alberta will produce and export record volumes of oil this year and the province can boost shipments abroad by about 10% by using existing pipeline and crude-by-rail facilities more efficiently, Kenney said. Enbridge Inc.’s new Line 3 pipeline and a so-called diluent recovery unit that allows heavier crude to be railed down to U.S. refineries will also help boost exports, he said.
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It’s not too late for Keystone XL, Alberta’s premier says
Adam Schultz/The White House via AP
As Russia has intensified its war on Ukraine, killing civilians and triggering a mass refugee crisis, President Joe Biden is expected to announce a ban on importing Russian fuel, according to a person familiar with the matter. Critics of Russia have said this would be the best — perhaps only — way to force Moscow to pull back.
A full embargo would be most effective if it included European allies, which are also desperate to stop the violence in Ukraine and the danger Moscow poses to the continent. Yet it's far from clear that Europe would take part in a total embargo.
Unlike the United States, Europe is deeply reliant on energy it imports from Russia. While the U.S. could replace the relatively small amount of fuel it receives from Moscow, Europe could not, at least not anytime soon.
What's more, any curbs on Russian oil exports would send already skyrocketing oil and gasoline prices ever higher on both continents and further squeeze consumers, businesses, financial markets and the global economy.
Here is a deeper look:
Adam Schultz/The White House via AP
As Russia has intensified its war on Ukraine, killing civilians and triggering a mass refugee crisis, President Joe Biden is expected to announce a ban on importing Russian fuel, according to a person familiar with the matter. Critics of Russia have said this would be the best — perhaps only — way to force Moscow to pull back.
A full embargo would be most effective if it included European allies, which are also desperate to stop the violence in Ukraine and the danger Moscow poses to the continent. Yet it's far from clear that Europe would take part in a total embargo.
Unlike the United States, Europe is deeply reliant on energy it imports from Russia. While the U.S. could replace the relatively small amount of fuel it receives from Moscow, Europe could not, at least not anytime soon.
What's more, any curbs on Russian oil exports would send already skyrocketing oil and gasoline prices ever higher on both continents and further squeeze consumers, businesses, financial markets and the global economy.
Here is a deeper look:
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It’s not too late for Keystone XL, Alberta’s premier says
AP Photo/Marcio Jose Sanchez
Amid rising gasoline prices in the U.S. — the average price has topped $4 a gallon for the first time since 2008 — the Biden administration faces growing pressure to impose further sanctions on Russia, including a ban on oil imports.
For now, a broad U.S.-European ban appears elusive. On Monday, German Chancellor Olaf Scholz made clear that his country, Europe's single-largest consumer of Russian energy, has no plans to join in any ban. In response, U.S. Deputy Secretary of State Wendy Sherman hinted that the U.S. could act alone or with a smaller group of allies.
“We have not been completely identical on all of the sanctions," Sherman said. “Not every country has done exactly the same thing, but we have all reached a threshold that is necessary to impose the severe costs that we have all agreed to.”
Even if a ban is enacted, the Biden administration and Congress “remain laser-focused on bringing down the higher energy costs for American families and our partners stemming from Putin’s invasion," House Speaker Nancy Pelosi said.
Pelosi, who has expressed support for a U.S. ban on Russian oil, nevertheless also cited Biden’s action in leading U.S. allies to release 60 million barrels of oil from strategic reserves, including 30 million barrels from U.S. reserves, to try to stabilize global markets.
AP Photo/Marcio Jose Sanchez
Amid rising gasoline prices in the U.S. — the average price has topped $4 a gallon for the first time since 2008 — the Biden administration faces growing pressure to impose further sanctions on Russia, including a ban on oil imports.
For now, a broad U.S.-European ban appears elusive. On Monday, German Chancellor Olaf Scholz made clear that his country, Europe's single-largest consumer of Russian energy, has no plans to join in any ban. In response, U.S. Deputy Secretary of State Wendy Sherman hinted that the U.S. could act alone or with a smaller group of allies.
“We have not been completely identical on all of the sanctions," Sherman said. “Not every country has done exactly the same thing, but we have all reached a threshold that is necessary to impose the severe costs that we have all agreed to.”
Even if a ban is enacted, the Biden administration and Congress “remain laser-focused on bringing down the higher energy costs for American families and our partners stemming from Putin’s invasion," House Speaker Nancy Pelosi said.
Pelosi, who has expressed support for a U.S. ban on Russian oil, nevertheless also cited Biden’s action in leading U.S. allies to release 60 million barrels of oil from strategic reserves, including 30 million barrels from U.S. reserves, to try to stabilize global markets.
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It’s not too late for Keystone XL, Alberta’s premier says
AP Photo/Patrick Semansky
If the U.S. acts alone in banning imports of Russian oil and refined products, the impact on Moscow would likely be minimal. The United States imports a small share of Russia's oil exports and doesn't buy any of Moscow's natural gas.
Last year, roughly 8% of U.S. imports of oil and petroleum products came from Russia. Together, the imports totaled the equivalent of 245 million barrels in 2021, which was roughly 672,000 barrels of oil and petroleum products a day. But imports of Russian oil vary and have have been declining rapidly as buyers shunned the fuel.
The U.S. could replace Russian crude with imports from Saudi Arabia and the United Arab Emirates. For its part, Russia might find alternative buyers for that fuel, perhaps in China or India. Such a step "would introduce massive inefficiency in the market,” which escalates prices, said Claudio Galimberti, senior vice president of analysis at Rystad Energy.
Yet if Russia were shut off from the global market, Galimberti said, rogue countries such as Iran and Venezuela might be "welcomed back" as sources of oil. Such additional sources could, in turn, potentially stabilize prices.
A team of Biden administration officials were in Venezuela over the weekend to discuss energy and other issues, White House press secretary Jen Psaki said. Officials discussed “a range of issues, including certainly energy security,'' Psaki said.
AP Photo/Patrick Semansky
If the U.S. acts alone in banning imports of Russian oil and refined products, the impact on Moscow would likely be minimal. The United States imports a small share of Russia's oil exports and doesn't buy any of Moscow's natural gas.
Last year, roughly 8% of U.S. imports of oil and petroleum products came from Russia. Together, the imports totaled the equivalent of 245 million barrels in 2021, which was roughly 672,000 barrels of oil and petroleum products a day. But imports of Russian oil vary and have have been declining rapidly as buyers shunned the fuel.
The U.S. could replace Russian crude with imports from Saudi Arabia and the United Arab Emirates. For its part, Russia might find alternative buyers for that fuel, perhaps in China or India. Such a step "would introduce massive inefficiency in the market,” which escalates prices, said Claudio Galimberti, senior vice president of analysis at Rystad Energy.
Yet if Russia were shut off from the global market, Galimberti said, rogue countries such as Iran and Venezuela might be "welcomed back" as sources of oil. Such additional sources could, in turn, potentially stabilize prices.
A team of Biden administration officials were in Venezuela over the weekend to discuss energy and other issues, White House press secretary Jen Psaki said. Officials discussed “a range of issues, including certainly energy security,'' Psaki said.
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It’s not too late for Keystone XL, Alberta’s premier says
AP Photo/Matt Rourke
A month ago, oil was selling for about $90 a barrel. Now, prices are surging past $120 a barrel as buyers shun Russian crude, with many refiners fearing that sanctions could be imposed in the future. They worry about being left with oil they couldn't resell as gasoline if sanctions were imposed in the near future.
Shell said Tuesday that it would stop buying Russian oil and natural gas and shut down its service stations, aviation fuels and other operations there, days after Ukraine’s foreign minister criticized the energy giant for continuing to buy Russian oil.
Energy analysts warn that prices could go as high to $160 or even $200 a barrel for crude oil if oil sanctions are imposed by the West or if buyers continue shunning Russian crude.
Oil prices that high could send an average gallon of U.S. gasoline past $5 a gallon, a scenario that Biden and other political figures are desperate to avoid.
AP Photo/Matt Rourke
A month ago, oil was selling for about $90 a barrel. Now, prices are surging past $120 a barrel as buyers shun Russian crude, with many refiners fearing that sanctions could be imposed in the future. They worry about being left with oil they couldn't resell as gasoline if sanctions were imposed in the near future.
Shell said Tuesday that it would stop buying Russian oil and natural gas and shut down its service stations, aviation fuels and other operations there, days after Ukraine’s foreign minister criticized the energy giant for continuing to buy Russian oil.
Energy analysts warn that prices could go as high to $160 or even $200 a barrel for crude oil if oil sanctions are imposed by the West or if buyers continue shunning Russian crude.
Oil prices that high could send an average gallon of U.S. gasoline past $5 a gallon, a scenario that Biden and other political figures are desperate to avoid.
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It’s not too late for Keystone XL, Alberta’s premier says
AP file
The U.S. oil industry has said it shares the goal of reducing reliance on foreign energy sources and is committed to working with the Biden administration and Congress. Even without sanctions, some U.S. refiners have severed contracts with Russian companies. Imports of Russian crude oil and products have tumbled.
“Our industry has taken significant and meaningful steps to unwind relationships” with Russia and voluntarily limit Russian imports, said Frank Macchiarola, senior vice president of the American Petroleum Institute, the oil and gas industry’s largest lobbying group.
Preliminary data from the U.S. Energy Department shows imports of Russian crude dropped to zero in the last week in February.
The petroleum institute hasn't taken a formal stance on legislation to ban Russian oil imports. But it says it would comply with any restrictions imposed.
AP file
The U.S. oil industry has said it shares the goal of reducing reliance on foreign energy sources and is committed to working with the Biden administration and Congress. Even without sanctions, some U.S. refiners have severed contracts with Russian companies. Imports of Russian crude oil and products have tumbled.
“Our industry has taken significant and meaningful steps to unwind relationships” with Russia and voluntarily limit Russian imports, said Frank Macchiarola, senior vice president of the American Petroleum Institute, the oil and gas industry’s largest lobbying group.
Preliminary data from the U.S. Energy Department shows imports of Russian crude dropped to zero in the last week in February.
The petroleum institute hasn't taken a formal stance on legislation to ban Russian oil imports. But it says it would comply with any restrictions imposed.
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It’s not too late for Keystone XL, Alberta’s premier says
Jens Buettner/dpa via AP, File
A ban on Russian oil and natural gas would be painful for Europe. Russia provides about 40% of Europe’s natural gas for home heating, electricity and industry uses and about a quarter of Europe's oil. European officials are looking for ways to reduce their dependence, but it's going to take time.
Russian Deputy Prime Minister Alexander Novak underlined that urgency, saying Russia would have “every right” to halt natural gas shipments to Europe through the Nord Stream 1 pipeline in retaliation for Germany halting the parallel Nord Stream 2 pipeline, which was not yet operating. He added that “we have not taken this decision” and that “no one would benefit from this.” It was a change from earlier Russian assurances that they had no intention of cutting off gas to Europe.
Oil is easier to replace than natural gas. Other countries could increase production of oil and ship it to Europe. But much oil would have to be replaced, and this would drive up prices even more because the oil would likely have to travel farther.
Replacing the natural gas that Russia provides to Europe is likely impossible in the short term. Most of the natural gas Russia provides to Europe travels through pipelines. To replace it, Europe would mostly import liquefied natural gas, known as LNG. The continent doesn't have enough pipelines to distribute gas from coastal import facilities to farther reaches of the continent.
In January, two-thirds of American LNG exports went to Europe. Some ships filled with LNG had been heading to Asia but turned around to go to Europe because buyers there offered to pay higher prices, according to S&P Global Platts.
While U.S. oil and gas producers could drill for more natural gas, its export facilities are already operating at capacity. Expanding those facilities would take years and billions of dollars.
Jens Buettner/dpa via AP, File
A ban on Russian oil and natural gas would be painful for Europe. Russia provides about 40% of Europe’s natural gas for home heating, electricity and industry uses and about a quarter of Europe's oil. European officials are looking for ways to reduce their dependence, but it's going to take time.
Russian Deputy Prime Minister Alexander Novak underlined that urgency, saying Russia would have “every right” to halt natural gas shipments to Europe through the Nord Stream 1 pipeline in retaliation for Germany halting the parallel Nord Stream 2 pipeline, which was not yet operating. He added that “we have not taken this decision” and that “no one would benefit from this.” It was a change from earlier Russian assurances that they had no intention of cutting off gas to Europe.
Oil is easier to replace than natural gas. Other countries could increase production of oil and ship it to Europe. But much oil would have to be replaced, and this would drive up prices even more because the oil would likely have to travel farther.
Replacing the natural gas that Russia provides to Europe is likely impossible in the short term. Most of the natural gas Russia provides to Europe travels through pipelines. To replace it, Europe would mostly import liquefied natural gas, known as LNG. The continent doesn't have enough pipelines to distribute gas from coastal import facilities to farther reaches of the continent.
In January, two-thirds of American LNG exports went to Europe. Some ships filled with LNG had been heading to Asia but turned around to go to Europe because buyers there offered to pay higher prices, according to S&P Global Platts.
While U.S. oil and gas producers could drill for more natural gas, its export facilities are already operating at capacity. Expanding those facilities would take years and billions of dollars.
