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CALGARY — Keystone XL is “just a pipeline” that will have little impact on the pace of development in the oil sands, says the head of TransCanada Corp., hitting back at opponents who argue that stopping the project is crucial to fighting climate change.
Chief executive officer Russ Girling said the $5.4-billion pipeline has unfairly been cast as the embodiment of the ills of the energy business. But he suggested that oil industry economics, including crude prices and the cost of production, will be more important than one proposed pipeline in determining how quickly Alberta increases its output from the oil sands.
The Keystone project “has become this symbol of everything that’s wrong with the fossil fuel energy industry. And it’s not,” he said. “It transports products from A to B, and it does that safely. It has no material impact on refining markets or supply.”
Mr. Girling’s comments, made in an exclusive interview with The Globe and Mail in advance of TransCanada’s annual meeting this week, illustrate one of the main arguments likely to be employed by the company and its supporters as the Keystone debate heads toward its conclusion.
In the U.S., the project is the subject of public hearings, congressional debate and arguments from the energy industry, unions, landowners and climate activists. Alberta Premier Alison Redford has said rejection of the project could damage the two countries’ strong economic relationship.
The U.S. State Department concluded last month the pipeline will not, on its own, have a major impact on development in the oil sands and, therefore, on global emissions of greenhouse gases. Mr. Girling’s remarks are intended to support that view, and to counter the opinions of environmentalists who say approval of Keystone XL would lift the remaining obstacles to unhindered oil sands growth.
When shareholders gather in Calgary this Friday, Mr. Girling and other executives will provide an overview of the company, which has an enterprise value of $55-billion and owns oil and gas pipelines and power generation and gas storage facilities across North America.
The uncertainty surrounding its highest-profile project is sure to surface, but the CEO will continue to make the argument that TransCanada has made the case for the pipeline from Hardisty, Alta., to the Texas Gulf Coast, and that the company is far more than the face of Keystone XL.
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