The cancellation of Energy East is the last of the big, nation-building pipeline decisions that resulted from Prime Minister Justin Trudeau’s forced transition to greener energy.
It’s another area of the economy that Ottawa has badly mishandled. It’s based on an energy model for Canada that is a lousy fit for its geology, history, economy, and the competencies and desires of its people, particularly in Western Canada. It’s the reason Calgary’s economy is dead when it should be humming with new activity amid rebounding oil prices, and that unemployment in Alberta is so high it’s a national political embarrassment.
Energy East died Thursday after Ottawa expanded its regulatory review to include climate change impacts of the whole upstream and downstream oil industry. Proponent TransCanada Corp. said it took the decision after “a careful review of changed circumstances.” It expects to take an estimated $1 billion after-tax non-cash charge in its fourth quarter results. The decision was made after a five-year application process.
Natural Resources Minister Jim Carr insisted TransCanada pulled the plug because of business considerations influenced by the state of commodity prices.
It’s amazing how business conditions deteriorate when regulatory processes drag on forever, are changed to the detriment of the proponent and hold no promise of fairness. As they say in the business, time kills all projects.While Energy East is over, the political outrage is just beginning and a Canadian unity crisis festering.
For the rest of this column: http://business.financialpost.com/commodities/energy/no-plan-b-for-liberals-on-pipelines